Keppelite. Exemplary role models. eppel. Keppel Group Newsletter. Strong start 4. Riding on. technological. waves 22. Beyond Earth.

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1 eppel April Keppel Group Newsletter Keppelite Strong start 4 Riding on technological waves 22 Beyond Earth Hour 46 Exemplary role models MICA (P) 041/01/2012

2 Contents SUSTAINING GROWTH Strong start 4 Driving growth 6 Seizing opportunities 8 Sustainable value creation 10 Keppel Land delivers stronger profits 12 Keppel T&T s Q1 net profit up 4% 14 K-Green Trust holds steady Preferred partner for Floatel s fleet 15 Winning repeat FPSO customers 16 Jacked up for Mexico 17 Keppel T&T expands footprint in China 18 Steady progress on FPSO Berantai 20 Stream of projects to N-KOM 21 Safe operations Riding on technological waves 22 Experienced leaders onboard 23 Flow of insights 24 Special Focus Inspiring Keppelites 26 Execution focus 29 Eco-City on track 30 People matter Deepening ties 31 Choice yard 32 School of hard knocks 33 Distinction for progress 34 Leading a new team Definitively Keppel 35 Reflections on the waterfront 36 Advocate for green buildings Boating bonanza by the Bay 37 EMPOWERING LIVES Welcome to the family 38 Walking the talk 39 Developing global talents 40 Orientated for growth 41 Prevention is better than cure Building bonds 42 Riding the Pacific waves 43 Roar and row 44 Platform for friendship Keppelites Abroad Braving new worlds 45 NURTURING COMMUNITIES Beyond Earth Hour 46 Stepping out for charity 48 Tribute to a pioneer 49 Amazing race SSO supporter 50 Friends for all seasons Keppel Volunteers Uniting to save Earth 51 BACK PAGE Five more DSS 38E units for Sete Brasil 52 at US$4.12 b eppel Cover image: Dr Lee Boon Yang, Chairman of Keppel Corporation, and Mr Choo Chiau Beng, CEO of Keppel Corporation, congratulating the recipients of the inaugural Outstanding Keppelite Awards in a ceremony on 23 March Published for people in the Keppel Group by the Group Corporate Communications Division, Keppel Corporation Limited, 1 HarbourFront Ave, #18-01 Keppel Bay Tower, Singapore Printed by Image Printers Pte Ltd, Blk 1002, Redhill Industrial Estate, Jalan Bukit Merah, #03-12, Singapore Editorial Advisor Wang Look Fung Editor Eileen Tan Editorial Committee Ang Lai Lee, Casiopia Low, Chan Suan Sim, Doreen Lim, Chua Ying Ying, Diana Chan, Donald Sng, Elizabeth Widjaja, Eva Ho, Frances Teh, Grace Chia, Hayley Teo, Hoo Yao Lin, Joycelyn Tay, Karin Xiao, Lim Kah Ai, Lee Chin Siang, Lee Wan Jun, Maria Magdalena, Mohamed Yusof Mohamed, Ong Tze Haung, Roy Tan, Serena Toh, Sue Ann Huang, Teri Liew, Wong Chai Yueh, Woon Pek Yong, Vett Ramos, Yolanda Guo CO REG NO: N

3 Editorial Driving technology to compete There is an old adage that says, Necessity is the mother of invention. As the global search for oil and gas pushes into even harsher terrains, breakthroughs in exploration and production technology have become vital. Keppel s technological capability is our key differentiator and forte. We focus on developing products that are not only technologically superior but commercially viable to meet the evolving needs of the industry. Other than enhancing our R&D activities, product development and commercialisation, this Division will also focus on process technology in improving productivity in all our shipyards. Driving our R&D effort is a deep-rooted desire to create value for our customers. Over the years, we have developed a range of proprietary solutions that have gained wide market confidence. Marrying our engineering expertise and execution experience with our customers operational insights, we are collaborating with owners and operators to enhance our rig designs. These invaluable partnerships have yielded cuttingedge, high-specification and harsh-environment worthy rigs. Our DSS series of semisubmersibles, developed in partnership with Marine Structure Consultants, is a prime example. They represent the most technically advanced deepwater drilling rigs to be designed and completed by Singapore. With improved capability and operability, the DSS 38E is well suited to meet the stringent requirements of the deepwater Golden Triangle region, comprising Brazil, Africa and the Gulf of Mexico while the DSS 51 HE/DSS 60 HE designs were developed for the North Sea. rigs on order globally are Keppel-made, as a result of our technology forte. Since October 2010, Keppel has secured 32 new rig orders for delivery into 2015, of which 28 will be built to Keppel s proprietary designs. We continue to reap the fruits of our technology efforts by winning the continued confidence of our customers. The recent rig package under letter of intent for five semisubmersible drilling rigs for Sete Brasil Participações S.A (see back page story) was also for Keppel s proprietary DSS 38E design. With record new orders keeping Keppel yards busy, we need to seek gains through both innovation and productivity from each project and every employee. Our shipyards have introduced greater automation as well as looked into production processes and skills training to achieve operational efficiencies. For instance, as a result of installing new equipment and processes in pipe fabrication over the last year, one of Keppel Shipyard s pipe shops was able to cut production man hours by 17% more than it had targeted at the start of Moving forward, our deep foundation in technology innovation will position us to meet the next wave of demand for even more capable rigs, as the renewal and upgrading of the global offshore fleet advance. More importantly, our work in developing new technological capabilities that balance safety, economic and environmental needs contribute to securing world energy supplies for the future. From the icy Arctic to the battering North Sea, through to the warmer waters of the Gulf of Mexico and across Asia, more than half of offshore

4 4 Sustaining Growth Growth Strong start The Group delivered a strong set of results with a record net profit for a quarter of $751 million. This was 141% higher than the corresponding period in Earnings per share were 41.9 cents. Economic Value Added of $654 million was $447 million higher than first quarter Annualised Return on Equity was 21.6%. REVENUE AND PROFITS Group revenue of $4,266 million was 86% above that of the comparative quarter in 2011 of $2,288 million. Revenue from Offshore & Marine Division of $1,994 million was $795 million or 66% higher. The increase in revenue was due to higher volume of work. The Division completed and delivered one semisubmersible rig, one drillship outfitting and several upgrade/repair contracts. Revenue from Infrastructure Division increased by 5% to $683 million. Higher revenue generated from the co-generation power plant in Singapore was partly offset by lower revenue from Engineering, Procurement and Construction contracts. Sales of real estate under the deferred payment scheme (DPS) are recognised under the completion of construction method. The delivery of residential units sold under the DPS to purchasers for Reflections at Keppel Bay has led to lumpy earnings for the quarter with Property Division seeing a 248% growth in revenue from $437 million to $1,521 million. At the pre-tax level, Group profit of $994 million was 121% above that of the corresponding quarter in Despite the 66% increase in revenue, Offshore & Marine Division reported a smaller increase in pre-tax profit of $49 million or 18% from the previous year. This was due mainly to contracts with lower margins. Profit from Infrastructure Division was $12 million or 24% lower compared to same quarter last year due to lower contribution from Keppel Integrated Engineering (KIE) and Keppel Energy. Property Division s profit rose 353% from $123 million to $557 million due mainly to higher contribution from Reflections at Keppel Bay sold under the DPS. This high level of profit from the Property Division is not expected in the next three quarters. Profit from Investments was $73 million higher due to sale of investments. Recognition of earnings from homes sold under the deferred payment scheme at Reflections at Keppel Bay has led to lumpy earnings for the quarter After taking into account income tax expenses and non-controlling interests, net profit attributable to shareholders was $751 million. Property Division was the largest contributor to net profit with 52%, followed by Offshore & Marine Division with 31%, Infrastructure Division with

5 Sustaining Growth 5 S$m 1Q 2012 % 1Q 2011 % % Change Offshore & Marine Infrastructure (33) Property >500 Investments >500 Total The increase in contribution from Offshore & Marine Division in the first quarter 2012 was due to higher volume of work as compared to first quarter % and Investments Division with 13%. PROSPECTS Offshore & Marine Division secured $688 million of new orders in the first quarter of The net orderbook stood at $8.4 billion with deliveries extending into The Division continues to see good prospects for the Offshore & Marine industry with the projected increase in Exploration and Production expenditure in the next few years and rising dayrates and utilisation rates for rigs. The Division will remain focused on project execution with continued investment in research and development to tap opportunities in existing and adjacent markets. In the Infrastructure Division, the expansion of the Keppel Merlimau Cogen power plant from 500MW to 1,300MW is on schedule for completion by Once completed, this will allow Keppel Energy to meet the projected increase in electricity demand. KIE continues to make progress with the operations and maintenance phase of the Domestic Solid Waste Management Centre in Qatar. The experience gained from overseas projects will enable us to better offer commercially viable solutions for environmental and urban solutions. With continued growth in Asia expected to sustain demand for logistics and data centres, we will focus on providing integrated logistics services in selected regional markets and building a portfolio o f h i g h - q u a l i t y d a t a centre assets. The Property Division achieved higher sales in Singapore for the first quarter, with over 90 residential units sold primarily from its suburban development, The Luxurie in Sengkang. Capitalising on leasing demand for luxury waterfront developments, the Group has set aside about 150 residential units at Reflections at Keppel Bay, which obtained its temporary occupation permit in late 2011, as corporate residences. In China, the Group sold about 190 residential units in the first quarter of Sales in China have continued to slow down due to the combined effects of the property cooling measures and the economic slowdown. The Group will continue to explore acquisition opportunities for residential, commercial and mixed-use development as well as monitor market conditions to selectively launch new projects and phases in Singapore and overseas at the appropriate time. The outlook for the global economy remains mixed with the continued uncertainty over the Eurozone sovereign debt situation and expected slower growth in China. Amidst this environment, the Group will continue to fortify collective strengths and capabilities among the Divisions, and enhance sustainable growth in our various businesses. keppelite

6 6 Sustaining Growth Driving growth Keppel Corporation s CEO, Mr Choo Chiau Beng presented the Company s 1Q 2012 results on 19 April Keppelite reproduces his speech. MIXED OUTLOOK T h e o u t l o o k f o r t h e global economy remains mixed. There are signs of improvement in the US economy, with some recovery seen in consumer spending, manufacturing and job creation. Notwithstanding the various policy response mechanisms, the Eurozone sovereign debt crisis remains unresolved with renewed concerns over Italy and Spain. Over in Asia, China s first quarter growth of 8.1% is the lowest since 2009 and the government has adjusted its 2012 growth target downwards to 7.5% as it seeks to transition the economy towards greater domestic consumption. The Singapore economy grew at a faster than expected pace of 9.9% in the first quarter, giving some optimism for the rest of The continued tensions in the Middle East over Iran and Syria are expected to hold up oil prices despite some projected weakness in demand from China. On the back of quantitative easing in the US and European Central Bank loans to troubled European banks, the world continues to see inflationary trends, especially in supply chain constrained markets such as Brazil. BUSINESS PROSPECTS Despite the mixed global outlook, the prospects for our key businesses remain good. The Offshore & Marine industry has continued to see good demand for new rigs in the first quarter. Major oil companies have budgeted increases in their Exploration and Production spending for 2012 and there have been a number of new oil and gas finds in Brazil, East Africa and the North Sea in the past months. The market for highspecification jackups has remained active while we also see a returning flow of orders for semisubmersibles. For this year, our Offshore & Marine Division secured $688 million of new orders to date. This does not include the design and construction of five additional semisubmersibles for which a Letter of Intent was signed with Sete Brasil. The formal contracts worth a total of US$4.12 billion will likely be inked in the middle of the year. Our net orderbook currently stands at $8.4 billion as at end March with deliveries extending until We continue to actively engage our customers to see how our solutions are able to meet their evolving needs. We expect to see a sustained e l e c t r i c i t y d e m a n d i n Singapore this year, which will support the earnings momentum for Keppel Energy s 500MW power plant on Jurong Island. Global demand for environmental engineering solutions continues to present opportunities for Keppel Integrated Engineering (KIE) to offer its proprietary technologies in waste and wastewater treatment. The operational and maintenance phase of the Qatar solid waste management facility is progressing well. The global growth in online transactions and cloud computing is stimulating good demand for quality data centres, which will provide a strong foundation for Keppel Telecommunications & Transportation (Keppel T&T) to grow its data centre business. In logistics, slowing trade volumes between Asia and Europe may impact the growth of Keppel T&T s business in this segment this year. In property, demand for homes in our key markets of Singapore and China has been affected somewhat Keppel O&M s Technology Division is responsible for Research & Development, product development and commercialisation as well as process technology

7 Sustaining Growth 7 Keppel Energy will strive to grow its share of the Singapore power market by the cooling measures. Private home prices in Singapore showed signs of further moderation in the first quarter with slowing sales in the luxury homes segment. Sales for mass market homes such as our development in Sengkang have held up, indicating that there continues to be good demand from genuine homebuyers. In China, home prices and sales volumes in the major cities have also fallen this year. Our developments in China, especially in the township developments, have continued to see some sales. We remain positive on the long-term prospects of markets such as China, Vietnam and Indonesia that have continued to show growth, and will focus on developing quality homes in these countries. Despite signs of moderation, Asia s growth is expected to remain on an even keel. Net office demand in Singapore is likely to remain positive in 2012 with positive leasing at new premium office buildings. Keppel s well-located office buildings at the heart of Singapore s CBD have continued to command good rentals. Our pipeline of commercial developments in China, Vietnam and Indonesia which will be completed over the next two to three years will also meet the demand for quality office space in the region. FOCUS IN 2012 In Offshore & Marine, we will work hard to execute our orderbook well to ensure that we meet our customers requirements safely, on time and on budget. No effort will be spared to further improve productivity and maximise efficiency to extract good value from each project. Technology continues to play an increasingly important role in the industry. Augmenting our proprietary semisubmersible designs, we have also developed two new designs DSS 51HE and DSS 60HE to meet the needs of drilling in deeper waters and harsher environments. Redoubling e f f o r t s t o e n h a n c e technology development, w e h a v e re s t r u c t u re d and elevated the Keppel Offshore & Marine (Keppel O&M) Technology Centre to become the Technology Division of Keppel O&M. This Division will be responsible for Research and Development, product development and commercialisation as well as Process Technology aimed at improving productivity in all our yards. In our Infrastructure Division, Keppel Energy will continue to grow its share of the Singapore power market as it enhances its position as an integrated platform in the power and gas business. KIE will focus on executing its Engineering, Procurement and Construction projects in Qatar and the UK while it continues to scan for projects in its key markets. Keppel T&T will work to complete its current logistics expansion projects in China in Wuhu and the Sino-Singapore Jilin Food Zone well and on schedule, so that it is well positioned to capture value from growing local demand for integrated port logistics and cold-chain logistics services. In Property, Keppel Land will continue to seek and selectively acquire quality sites in Singapore and overseas for both residential and commercial developments. We have again appointed Daniel Libeskind to design Plot 3 of Keppel Bay and will time the launch according to market conditions. We will also continue to grow our fee-based property fund management business, scanning for good opportunities to enhance our portfolio of quality assets. CONTINUE DELIVERING VALUE In today s climate of economic uncertainty, we are committed to maintain a strong balance sheet that will give us the financial resilience to weather the cyclicality of our underlying businesses as well as the flexibility to seize opportunities as they arise. Our aim is to drive sustainable growth in our businesses and to continue delivering value to our customers and shareholders. keppelite

8 8 Sustaining Growth Seizing opportunities Consistent earnings and a strong balance sheet put Keppel in good stead to navigate through market volatility. Keppel will be disciplined in seizing investment opportunities to create more value. Keppelite reproduces excerpts of CFO, Mr Loh Chin Hua s review of the quarter s performance and company outlook. FREE CASH FLOW Net cash generated from the quarter s operations was $1 billion, a sharp increase from the previous year. Net cash from operating activities was lower than the corresponding period last year due to higher working capital brought about by higher expenditure on property developments and Offshore & Marine contracts, partly offset by proceeds from the sale of Reflections at Keppel Bay and disposal of investments. The Group spent $263 million on acquisitions and capital expenditure. This included the capital expenditure for the expansion of Keppel Merlimau Cogen (KMC) p l a n t, i n v e s t m e n t i n associated companies and other operational capital expenditure. After taking into account divestment and dividend income of $42 million, net cash used in investing activities was $263 million. Cash outflow for the quarter was $193 million. BUSINESS REVIEW AND OUTLOOK Offshore & Marine The rig charter market has remained tight with rising dayrates, high utilisation rates and longer charter terms. This trend bodes well for a sustained order momentum for newbuild rigs as well as major upgrading work on older rigs. Demonstrating confidence in Keppel s quality project execution and delivery, we have secured new orders on Floating Production Storage and Offloading upgrading and jackup projects during the quarter from our longterm partners and customers. We have also recently signed a Letter of Intent for US$4.12 billion from Sete Brasil to build five semisubmersibles. the design and engineering of offshore wind turbine foundations and developer of a proprietary jacket foundation design, we are confident of further providing quality products to our customers. We have also partnered ConocoPhillips to jointly design the first ice-worthy jackup. This rig design is expected to achieve significant breakthroughs in offshore Arctic drilling. Infrastructure We continue to see healthy earnings posted from our co-generation plant. The 800 MW expansion of the KMC plant is progressing well and on track to be completed next year. With the increased capacity, we expect the plant to generate higher earnings for the Group. Ensco 8505 semisubmersible is the sixth rig delivered to Ensco on time, within budget and safely The successful deliveries made by the Division in the first quarter also add to our track record of quality and on-schedule execution. We remain committed in offering innovative solutions and design to our customers. With our investment in OWEC Tower, the leader in K e p p e l I n t e g r a t e d Engineering continues to build its track record in Engineering, Procurement and Construction, Operations and Maintenance, and Technology Packages for Waste to Energy (WTE) projects. It recently won its first WTE technology package contract in India.

9 Sustaining Growth 9 Operation and maintenance phase of the Domestic Solid Waste Management Centre is progressing well Capitalising on the increasing demand for energy-efficient cooling systems, Keppel District Heating and Cooling Systems has successfully secured additional longterm district cooling service contracts at one-north, a business park in Singapore. As part of the efforts t o s t re n g t h e n K e p p e l Telecommunications & Transportation s (Keppel T&T) foothold in the region, the joint venture between Keppel T&T and Jilin Sino- S i n g a p o re F o o d Z o n e Development Co. Ltd, will provide a consolidated platform to meet the trading and logistical needs of our customers in the Food Zone. The acquisition of a London data centre by Securus Fund will also allow Keppel T&T to expand its international portfolio of institutionalquality data centre assets. Property Sales of residential properties in Singapore and our overseas markets have moderated. A total of 360 homes were sold by the group during the quarter. We have sold 90% of our waterfront homes that have been launched at Reflections at Keppel Bay. The completion of this iconic development has further enhanced Keppel Bay as the premier waterfront precinct in Singapore. Plans for the development of Plot 3, that will offer approximately 367 homes, is in the pipeline. On the commercial front, development of Seasons City is on track to offer quality office space in the Tianjin Eco-City. The acquisition of a prime site in Beijing s Central Business District (CBD) has enabled Keppel Land to participate in the rapidly improving office market in the capital city. Saigon Centre Phase 2 has successfully secured Takashimaya as its anchor tenant. As at end February, it has pre-leased 30% of the project s total retail space. In Indonesia, the redevelopment of International Financial Centre Jakarta will meet the demand of tenants seeking well specified and sustainable buildings in Jakarta s CBD. Completion is targeted for GROUP OUTLOOK We have ushered in 2012 on a firm note, with good results posted by the various divisions. W i t h t h e c o n t i n u e d uncertainty looming over the global economy as a result of the Eurozone sovereign debt situation which is not yet fully resolved, and the various potential flashpoints around the globe, Keppel has to remain vigilant. T h e c o n t i n u e d g o o d performance of our existing businesses and our strong balance sheet puts us in good stead to navigate any potential market volatility. We will continue to be disciplined in our investments, recycle capital where appropriate, and be on the lookout for good investment opportunities in our existing core businesses as well as in the close adjacencies. We remain committed in strengthening our core competencies and driving excellence in our businesses, in order to deliver quality results to our stakeholders in the coming quarters. keppelite

10 10 Sustaining Growth Sustainable value creation Keppelite highlights the key questions and answers raised at the 1Q 2012 results webcast. ON OFFSHORE & MARINE S OUTLOOK CCB AND TCH: Enquiries for jackups and semisubmersibles are still active. We expect to firm up the Floatel contract in the second half of the year. If we receive an order today for a jackup, the earliest delivery slot would be 2014, while for a semisubmersible, it would be Yard constraint in Singapore has always been a concern. Fortunately for us, we have additional yard capacity in the Philippines, both in Subic and in Batangas; in Bintan, Indonesia and in Nantong, China. These yards will be able to meet our requirements. The Technology Division in Keppel Offshore & Marine (Keppel O&M) would focus on two areas of improving productivity process improvements and reducing labour usage. For example, we are automating our pipe shops and there are other areas that we can continue to automate. The conceptual design of the ice-worthy jackup has been completed. The detailed design depends on whoever places the order for the first unit. The market for financing of rigs has improved in some areas. However, speculative orders may still find it very difficult to get financing. ON BRAZIL ORDERS AND CAPEX TCH: The first semisubmersible we secured from Sete Brasil will have a construction lead time of 48 months. We are comfortable with this lead time. As for the other five units for which we have signed the Letter of Intent, we will only know the delivery dates when the contract is signed. The interval between deliveries would be about 10 months. CCB: The first of the six semisubmersibles for Sete Brasil has local content of 55%. Our current capacity in Brazil, with improvements in arrangements and processes, should be able to deliver as we have promised. However, if we want more orders, we would have to improve, expand and spend capital expenditure (capex) to increase our capacity. We are unable to provide a particular capex figure for Brazil at the moment, but there will be some capex to be spent. We are also looking for more yard space in Brazil. ON OFFSHORE & MARINE S MARGINS AND ASSOCIATE INCOME CCB: We have stressed many times that we had a bumper margin in 2011 and we do not expect it to be sustainable. Our long-term, sustainable margin level is between 10-12%. We are happy with the 15% margin achieved this quarter as 12-15% margin is at the higher-end range of the margins that we have experienced in the long cycle. We can expect margins to be within the range that we have been targeting for in the next three quarters. Margins also depend very BrasFELS yard is seeking ways to enhance operational efficiencies to meet the demand for locally-built rigs in Brazil

11 Sustaining Growth 11 Saigon Centre Phase 2 has signed on Takashimaya as anchor tenant with pre-commitment of about 15,000 sm of retail space across five floors much on the amount and type of repair or upgrade work that we can get. Margins of repair or upgrade work are normally higher than newbuilding. Keppel Shipyard, Keppel FELS as well as Keppel AmFELS have done a lot of upgrading and repair work. The fall in associate income was mainly attributable to a decline in earnings from our yard in Kazakhstan. This year, as the Kashagan project was delayed, we do not have much income from our Kazakhstan yard. ON FLOATEL CCB: We have privatised Floatel as we felt that we can grow the business faster. We have a partner from a fund and we currently have 47% stake in Floatel. We intend to grow the business further and when it makes sense to float it, we will. ON INFRASTRUCTURE DIVISION TCH: As reported in the last few quarters, we had faced challenges in our Doha North project in Qatar. That was one reason why the contribution from Keppel Integrated Engineering has been affected. TSH: The gearing of Keppel Telecommunications & Transportation at the end of the first quarter was about 0.5x. By the end of the year, the gearing will go up to about 0.75x. We believe it is a gearing level that would be sustainable. We would also be looking at realising some of the assets that we have, and that should bring the gearing down in time. We have made various announcements about growing our logistics business in China. For example, we have a port logistics development in Wuhu. Recently, we have completed the warehouse in Nanhai, Foshan and signed an agreement to develop the Sino-Singapore Jilin Food Zone International Logistics Park. We have also obtained a licence to build a green logistics distribution centre in Tianjin. For data centres, our capacity in Singapore is fully utilised. Through our Securus data centre fund, we have also acquired some data centres one in Sydney, one in Brisbane, and another in London recently. ON PROPERTY Division LCH: We have recognised about $1.3 billion in revenue from units of Reflections at Keppel Bay sold under the deferred payment scheme. Most of the earnings, except for 100 units, have been recognised in the first quarter. Out of the $393 million net profit, a significant portion comes from these units. CCB: We have announced that our project in Vietnam, Saigon Centre Phase 2, will have a substantial retail component. Takashimaya, the Japanese departmental store, has agreed to come onboard as the anchor tenant while its parent, Toshin Development, will jointly manage the retail component. We will also develop a retail mall in our Tianjin Eco- City project in China called Season City. Where useful, we will look for partners. ON FOREIGN LABOUR TCH: Keppel O&M has been working with the various government ministries to make better use of our foreign workers. We will only take on jobs that we are confident of delivering on time. If need be, we can also outsource some work to our yards around the world. As such, we will be able to manage our workload with a tightened foreign labour situation. keppelite CCB Choo Chiau Beng, CEO of Keppel Corporation TSH Teo Soon Hoe, Senior ED of Keppel Corporation and Chairman of Keppel Telecommunications & Transportation TCH Tong Chong Heong, Senior ED of Keppel Corporation, CEO of Keppel Offshore & Marine and Chairman of Keppel Integrated Engineering LCH Loh Chin Hua, CFO of Keppel Corporation

12 12 Sustaining Growth Keppel Land delivers stronger profits Keppel Land achieved net profit of $141.9 million for 1Q ended 31 March 2012, representing a 70.3% increment than the net profit of $83.3 million for the same period last year. Earnings were lifted mainly by improved contribution from property trading with the completion of several projects/ phases in Singapore and China. Net profit from property trading more than tripled to $133.4 million compared with $43 million in 1Q The strong performance was largely due to bumper contribution from Reflections at Keppel Bay following the handover of completed units to buyers who bought under the deferred payment scheme (DPS)*. There were also contributions from Marina Bay Suites on higher percentage of completion as well as completed phases at The Springdale, The Botanica and Central Park City in China. Property investment also p e r f o r m e d w e l l w i t h net profit up 37.9% to $20 million on higher contribution from K-REIT Asia following its acquisition of a 87.5% interest in Ocean Financial Centre (OFC). Higher fee income for K-REIT Asia Management (K-REIT Asia) and Alpha Investment Partners (Alpha) led to a 36.2% increase in net profit from fund management to $12.8 million, compared with $9.4 million in 1Q Moderation in Property Market Singapore s private residential sales in 1Q 2012 remained strong, especially in the suburban market, despite the introduction of the Additional Buyer s Stamp Duty last December and a weaker global economic climate. Keppel Land sold over 90 homes in the period with the bulk from its suburban development, The Luxurie in Sengkang, demonstrating continued demand for well-located homes. The group has set aside about 150 units at Reflections at Keppel Bay for corporate residences to capitalise on leasing demand for luxury waterfront homes. Average Grade A office rent in Singapore declined by 3.6% quarter-on-quarter to $10.60 psf as at end- March 2012, according to CB Richard Ellis. New Grade A office supply is limited in 2012, with Marina Bay Financial Centre Tower 3, which recently obtained its temporary occupation permit, being the only contributor to prime commercial space in the Central Business District for the year. Keppel Land continues to see strong demand for well-located properties such as The Luxurie in Sengkang Keppel Land s private fund management vehicle, Alpha, continues to seize opportunity in selective divestment. Its Alpha Asia Macro Trends Fund is divesting a serviced apartment development located close to Times Square in Hong Kong. Subdued Sentiments Overseas Overseas residential sales remained subdued on cautious market sentiments amid property cooling m e a s u r e s a n d g l o b a l economic uncertainties. Keppel Land sold about 270 overseas homes in 1Q 2012 with China accounting for the bulk of residential sales. In Indonesia, the group s township development, Jakarta Garden City, continues to achieve good take-up with over 40 units sold in 1Q Following the recent launch of Phase 2, the project has sold about 96% of 1,000 launched units as at end-march In Vietnam, Keppel Land has secured Takashimaya as the

13 Sustaining Growth 13 KEPPEL LAND S FINANCIAL HIGHLIGHTS ($m) Quarter Ended % Change 31 Mar Mar 2011 Turnover (52.4) Pre-tax Profit Net Profit Net Debt/Equity Ratio (x) ^ (33.3) NTA/Share ($) ^ 28.7 * With the adoption of the INT FRS 115 from 1 Jan 2011, profit from units sold under DPS in Singapore is recognised upon completion. ^ Restated due to the adoption of the Amendments to FRS 12. anchor tenant for Saigon Centre Phase 2 in Ho Chi Minh City. Takashimaya has pre-committed about 30% of total retail space ahead of its expected completion in The group has also entered into a strategic partnership with Toshin Development, a subsidiary of Takashimaya, divesting a 22.7% stake in Saigon Centre Phase 2 to Toshin. The group remains confident of Asia s growth prospects and will seek to add to its landbank in Singapore and overseas for residential, commercial, township and mixed-use developments. K-REIT Asia doubles 1Q distributable income K-REIT Asia doubled its distributable income to $48.5 million in 1Q 2012, from $24.3 million in 1Q The increase was due to higher contributions from its existing properties and new acquisitions comprising the additional four floors of strata office space at Prudential Tower, 50% interest in 8 Chifley Square and approximately 87.5% interest in OFC (OFC Interest). P ro p e r t y i n c o m e ro s e 96.0% year-on-year to $36.6 million, due mainly to the $17.3 million contribution from the OFC Interest and, to the higher property income from the Prudential Tower Property and 50% interest in 275 George Street. These higher income streams translated to a 90.8% increase in net property income to $28.5 million. Share of results of associates i n c r e a s e d % t o $11.2 million as a result of higher contribution from the one-third interest in BFC Development Pte Ltd (BFCDPL) and One Raffles Quay Pte Ltd. Interest income increased 22.0% to $6.9 million, due mainly to the coupon interest income from the 50% interest in 8 Chifley Square and higher interest income on the shareholder loan to BFCDPL. Although currently under construction, the interest in 8 Chifley Square will provide regular coupon interest income until the building s expected completion in 3Q The Board of Directors of K-REIT Asia has also announced that it will make its distribution on a quarterly basis commencing from the financial quarter ending 30 September Looking ahead, K-REIT Asia s strong portfolio fundamentals and prudent capital management put it in good stead to weather the economic uncertainties in the year ahead. Its long weighted average lease expiry of approximately 8 years for the top 10 tenants, good quality tenants and limited amount of leases due for rent review and renewal will mitigate K-REIT Asia s downside risks. keppelite The interest in 8 Chifley Square will provide regular coupon interest income until the building s expected completion in 3Q 2013

14 14 Sustaining Growth Keppel T&T s Q1 net profit up 4% Keppel Telecommunications & Transportation (Keppel T&T) delivered creditable 1Q 2012 results with net p r o f i t a t t r i b u t a b l e to shareholders of $14.4 million, an improvement of 4% from $13.9 million in the corresponding period in Keppel T&T raised operating profit by 48% to $6.4 million in 1Q2012, boosted by the Data Centre division s improved performance Operating profit of $6.4 million was a 48% improvement from the $4.3 million seen last year, due mainly to improved performance by the Data Centre division. Revenue of $33.6 million was $3.3 million or 11% above the corresponding quarter in 2011, as both the Data Centre and Logistics divisions generated higher turnover. Earnings per share improved by 4% to 2.6 cents and net asset value per ordinary share increased 3 cents to 74.0 cents per share during the quarter. For logistics, Keppel T&T will strive to maintain high occupancy rates in its logistics facilities in China and Southeast Asia. Recently, a joint venture agreement was signed with the Jilin City Government to jointly develop and operate the Sino-Singapore Jilin Food Zone International Logistics Park in China (refer to story on page 18). Keppel T&T s data centres are currently enjoying strong demand. Securus Data Property Fund recently acquired an asset in London, United Kingdom. The Fund will continue its efforts to grow through further acquisitions. keppelite K-Green Trust holds steady K-Green Trust (KGT) posted a first quarter profit after tax at $3.5 million, consistent with the corresponding period in Earnings per unit were at 0.56 cents. Revenue for the three months ended 31 March 2012 was $19 million, 4.4% up from $18.2 million year-on-year. This is mainly due to an increase in the operation and maintenance (O&M) income attributable to the annual adjustments of O&M tariffs to account for changes in consumer price index as well as slightly higher output from the plants. Group unitholders funds decreased from $697.2 million at 31 December 2011 to $671.2 million at 31 March The decrease was mainly attributable to the distribution of $29.5 million paid to unitholders during the period, partially offset by an increase in comprehensive income for the period of $3.5 million. The trust currently owns three plants Senoko Waste-to- Energy (WTE) Plant, Keppel Seghers Tuas WTE Plant and the Keppel Seghers Ulu Pandan NEWater Plant. The flue gas treatment facilities upgrade project for Senoko WTE Plant is in progress and is scheduled to complete by June The performance for KGT s three portfolio assets is expected to remain stable. The Trustee-Manager will continue to evaluate asset enhancement opportunities in all three assets. The Trustee-Manager will remain focused on acquisitions in areas of waste management, water treatment, renewable energy and energy efficiency. Key geographies for potential acquisitions remain as Europe and Asia Pacific. keppelite

15 Sustaining Growth 15 Preferred partner for Floatel s fleet Keppel FELS entered into a Letter of Intent on 28 March 2012 with repeat customer, F l o a t e l I n t e r n a t i o n a l Ltd (Floatel), to build a new-generation harsh environment accommodation semisubmersible worth US$315 million for delivery in July This will be Floatel s fourth accommodation semisubmersible by Keppel FELS after the delivery of Floatel Superior and Floatel Reliance in 2010 and the order of Floatel Victory in Mr Wong Kok Seng, MD of Keppel FELS, said, Keppel-built and designed accommodation semisubmersibles have proven their worth wherever they have been deployed. We are proud to note that all our semisubmersibles for Floatel have been chartered with good performances and are pleased to support them as they grow their fleet to become a leading operator in their niche. We look forward to provide yet another highly capable accommodation s e m i s u b m e r s i b l e t o Floatel safely, on time and within budget. The new semisubmersible will be based on the Floatel Superior design, a DSS 20NS design developed by GustoMSC and Keppel FELS Deepwater Technology Group. Equipped with Dynamic Positioning 3 capability, it will meet the most stringent rules and regulations for worldwide operations including the Norwegian Sector. Mr Peter Jacobsson, CEO of Floatel, added, We continue to build our fleet of highly capable accommodation vessels such as Floatel Superior to meet global demand for safe and cost efficient service. The DSS 20NS has been a proven design for us, with Floatel Superior achieving excellent performances wherever she has operated, first for ConocoPhillips Australia in the Timor Sea and presently for Statoil in Norway s Oseberg field. When completed, the new semisubmersible will be able to accommodate 440 persons in single bed cabins with ample recreation areas as well as office amenities. Well-equipped with a host of modern facilities, the vessel is ideal for construction support during new construction, maintenance activities or for decommissioning projects of offshore oil and gas installations. keppelite The new vessel will be based on the Floatel Superior design, which was delivered by Keppel FELS to Floatel in 2010 and has been successfully working for Statoil in Norway s Oseberg field

16 16 Sustaining Growth Winning repeat FPSO customers Reputed for safe, reliable and prompt turnarounds, Keppel Shipyard remains the preferred partner for Floating Production Storage and Offloading (FPSO) conversions globally. The company has recently secured two FPSO upgrading projects worth $170 million in total from long-term customers, SBM Offshore N.V. (SBM Offshore) and B u m i A r m a d a B e r h a d (Bumi Armada). Mr Nelson Yeo, MD of Keppel Shipyard, said, We thank SBM Offshore and Bumi Armada for reinforcing their trust and confidence in us with these FPSO contracts. Drawing on our experiences from previous collaborations, we strive to continuously improve our performance as we move forward. For SBM Offshore, Keppel Shipyard will refurbish and upgrade an existing vessel, FPSO Xikomba, with work expected to be completed by 3Q Mr Bruno Chabas, CEO of SBM Offshore, said, Longterm business partnerships are key to our performance, our ability to deliver and our ambition in furthering our lead in the FPSO market. We v a l u e o u r p ro v e n partnership with Keppel Shipyard. The award of the FPSO Xikomba is another milestone in this deep longterm relationship. Leased by Eni Angola S.p.A for 12 years for the development of Block 15/06, offshore Angola, FPSO Xikomba is jointly owned by SBM Offshore and Sociedade Nacional de Combustíveis de Angola, E.P. (Sonangol), Angola s national oil and gas company. The other project secured by Keppel Shipyard is the modification and upgrading of Bumi Armada s FPSO Armada Claire. The scope of work includes refurbishment and life extension works as well as installation and integration of topside modules. Work is expected to commence in 3Q Upon completion in 4Q 2013, FPSO Armada Claire will be deployed in the Balnaves Field, north-west Australia. Mr Hassan Basma, ED and CEO of Bumi Armada, said, With the trust and collaboration of committed and capable business partners, we have grown and enhanced our fleet of quality FPSO vessels. The Armada Claire project is our tenth major collaboration with Keppel Shipyard and we are confident that it will be professionally executed. keppelite Since 2000, Keppel has delivered 14 FPSO/FSO conversion projects to its longstanding customer SBM Offshore The scope of work includes life extension, refurbishment and upgrading of existing t o p s i d e m o d u l e s a n d turret mooring system as well as the installation and integration of new topside modules. The FPSO vessel will subsequently proceed to Angola for completion. In 2011, Keppel Shipyard delivered FPSO Armada TGT 1 (photograph above) and FSO Sepat to Bumi Armada

17 Sustaining Growth 17 Jacked up for Mexico Keppel AmFELS, Keppel Offshore & Marine s yard in Brownsville, Texas, scored a contract from Mexico s Perforadora Central to build a repeat jackup rig worth US$205 million on 2 April Mr Tan Geok Seng, President of Keppel AmFELS, said, Keppel AmFELS has had a great relationship with Perforadora Central that dates back to We are honoured to be building another jackup, our fourth, for Perforadora Central and are grateful for their continued trust and confidence in us. We have endured the post- Macondo challenges well. Having recently secured the Ocean Onyx semisubmersible major upgrade and a series of repairs, this newbuild jackup adds to a healthy workload through 1Q We also continue to pursue projects from Pemex and we are optimistic about our chances. Slated for delivery in 1Q 2014, this latest high-specification unit will be based on the LeTourneau Super 116E design with leg lengths of 511 ft and the capability to drill wells up to 30,000 ft at a water depth of 375 ft. In keeping with its tradition of safe, on-time and within- budget deliveries, Keppel AmFELS completed Tonala, an ultra premium KFELS B Class jackup rig for Perforadora Central in 2004, followed by Tuxpan, a LeTourneau S116E rig in The Papaloapan jackup, which was ordered by Perforadora Central in March 2011, is under construction and on track for delivery in 1Q Perforadora Central added, W ith each successive project, Keppel AmFELS has reaffirmed its expert project management and construction capabilities as well as commitment to the highest standards of safety and quality. Our Tonala and Tuxpan jackups are turning in excellent performances for PEMEX in Mexico while construction of Papaloapan is ahead of schedule. We are confident that our latest newbuild by Keppel AmFELS will be another exceptional product to boost our track record and establish us as the foremost provider of drilling solutions in Mexico. At the end of 2011, Mexico was the world s seventh largest producer of crude oil and and among the 15 largest natural gas producers. PEMEX, Mexico s national oil company announced an overall Keppel AmFELS completed a similar rig, Tuxpan, for Perforadora Central in 2010 and is currently constructing another jackup, the Papaloapan exploration and production budget of approximately US$18.36 billion in Perforadora Central is a Mexican company providing offshore and onshore drilling services mainly for PEMEX. keppelite

18 18 Sustaining Growth Keppel T&T expands footprint in China Joint venture company will be the sole food logistics park operator within the Sino-Singapore Jilin Food Zone and will provide a consolidated platform for the trading, storage and distribution of food products. Deputy Chairman of Jilin Sino-Singapore Food Zone Development Co., Ltd, Mr Sun Zhu Gang (front right), and Keppel T&T CEO, Mr Pang Hee Hon (front left), signed the joint venture agreement to develop and operate the Sino-Singapore Jilin Food Zone International Logistics Park Keppel Telecommunications & Transportation s (Keppel T&T) wholly-owned subsidiary, Keppel Jilin Food Logistics Park, has signed a joint venture (JV) agreement with the Jilin City Government to jointly develop and operate the Sino-Singapore Jilin Food Zone International Logistics Park. The JV company, Jilin Sino-Singapore Food Zone International Logistics Co. Ltd., will be 70% held by Keppel T&T through its wholly-owned subsidiary and 30% held by Jilin S i n o - S i n g a p o r e F o o d Zone Development Co., Ltd. Its registered capital of RMB 200 million will be contributed by the parties in cash in proportion to their shareholdings. The JV agreement was signed on 28 March 2012 between Mr Sun Zhu Gang, Deputy Chairman of Jilin Sino-Singapore Food Zone Development Co., Ltd and Mr Pang Hee Hon, CEO of Keppel T&T, in a ceremony witnessed by Mr Zhang Xiao Pei, Party Secretary for Jilin City, and Mr Teo Soon Hoe, Senior ED of Keppel Corporation and Chairman of Keppel T&T. M r P a n g s a i d, T h e Sino-Singapore Jilin Food Zone International Logistics Park is a key component of our strategy in strengthening Keppel T&T s foothold and presence in the northern regions of China. By leveraging Keppel T&T s expertise in third party logistics and cold chain services, the joint venture company will not only be the operator of the Logistics Park, but will also provide integrated logistics services. Such integration of the food marketplace with the provision of logistics services will offer users a seamless flow of transactions and services. The agreement follows the signing of a non-binding Memorandum of Understanding with Jilin City Government s project office last year and the conclusion of feasibility studies. The Sino-Singapore Jilin Food Zone International Logistics Park will be developed in phases, with the first phase to be developed at an estimated total development cost of RMB 598 million. As the sole food logistics park operator within the Food Zone, the JV company will provide a consolidated platform for the trading, storage and distribution of food products. The Logistics

19 Sustaining Growth 19 The Sino- Singapore Jilin Food Zone International Logistics Park is a key component of our strategy in strengthening Keppel T&T s foothold and presence in the northern regions of China. Mr Pang Hee Hon CEO Keppel Telecommunications & Transportation Park will include facilities such as a wholesale food marketplace, temperaturecontrolled warehouses, offices and a transportation hub to meet the trading and logistical needs of all the stakeholders in the Food Zone. Spanning approximately 40 ha, the first phase of the Logistics Park will be designed to have about 44,000 sm of warehouse space fitted with cold room facilities, a modern cross-docking hub and a centralised transportation hub. It will also offer space for offices and more than 1,000 units of wholesale shops. Operations are expected to commence in Located at the northern boundary of the Food Zone, the Logistics Park will occupy 114 ha when fully developed and will be accessible via major expressways. Future plans to link a railway line to the Logistics Park will further enhance its accessibility for distribution. The Sino-Singapore Jilin Food Zone has the strong support of the Jilin provincial government. The project is regarded as one of the key initiatives for the Changchun- J i l i n I n t e g r a t i o n development strategy, which aims to industrialise and urbanise both cities to spur economic growth. The Food Zone is located at the western border of Jilin City, which is just adjacent to Changchun City, and is 40 km away from both Changchun and Jilin city centres. With a core zone of 57 sq km, the Food Zone will be home to the production of agricultural foodstuff, grown and processed under stringent health and quality standards. keppelite Russia 俄罗斯 HEILONGJIANG 黑龙江 Changchun Longjia International Airport 长春龙嘉国际机场 CHINA 中国 Changchun City 长春市 LIAONING 辽宁 Jilin City 吉林市 JILIN 吉林 N.Korea 朝鲜 Pacific Ocean 太平洋 40km to Changchun City 至长春市 40 公里 长春外环高速公路 ( 规划中 ) Commercial and residential zone 商住区 Changchun Exterior Ring Road (planned) SINO-SINGAPORE JILIN FOOD ZONE 57 KM 2 CORE ZONE 中新吉林食品区 57 平方公里核心区 SINO-SINGAPORE JILIN FOOD ZONE INTERNATIONAL LOGISTICS PARK 中新吉林食品区国际物流园 Green zone 景观绿地区 Administration zone 行政办公区 New National Highway 302 新 302 国道 40km to Jilin City 至吉林市 40 公里 Railway line (planned) 铁路线 ( 规划中 To Jilin City Inland Port 至吉林市内陆港 Food processing zone 食品加工区 The Sino-Singapore Jilin Food Zone International Logistics Park, located at the northern boundary of the Sino-Singapore Jilin Food Zone, will occupy 114 ha when fully developed

20 20 Sustaining Growth Steady progress on FPSO Berantai After months of hard work, the first Floating Production Storage and Offloading (FPSO) conversion project between Keppel Shipyard and Petrofac is nearing completion. At a ceremony held at Keppel Shipyard on 14 April 2012, FPSO Berantai was named by Lady Sponsor Puan Hatijah Abdul Latiff, wife of Guest-of-Honour, Encik Ramlan Abdul Malek, VP, Petroleum Management, PETRONAS. Mr Tong Chong Heong, CEO of Keppel Offshore & Marine, said, While this is the first time Keppel Shipyard is working directly with Petrofac on a conversion job, we are glad to see g o o d t e a m w o r k a n d understanding between the project teams of our two companies. The teams have shown full commitment to safe, high quality and timely execution throughout the project. The FPSO will be deployed by oil field operator, Berantai Risk Sharing Contract (RSC) Joint Venture (JV) which comprises Kencana Energy, Sapura Energy Ventures and Petrofac Energy Development in the Berantai field in offshore Peninsular Malaysia. K e p p e l S h i p y a r d a n d Petrofac project teams have collaborated closely to progress the project steadily and safely, with about four million safe man-hours clocked to-date. At the naming ceremony, the Berantai RSC JV also presented Health, Safety and Environment (HSE) awards to recognise exceptional safety performances. Keppel Shipyard was presented with the HSE Appreciation Award for its efforts to ensure an incidentfree workplace. Mr Burt Loh, GM (Operations) and Mr Goh Tong Woo, Senior Project Manager at Keppel Shipyard received the award on behalf of the company. F o r e x e m p l a r y H S E performances, Keppel Shipyard s Suresh Kumar, H u l l S u p e r v i s o r, a n d Md Monjil Miah, Scaffolding Supervisor, were recognised as Employee of the Month for March and the Best Overall HSE Performance by an Employee for the Project respectively. For this conversion project, Keppel Shipyard carried out refurbishment, life extension and upgrading works. It also partnered sister company DPS (Bristol) to carry out detailed engineering for the majority of the topside process modules as well as undertook fabrication, installation and integration of all the modules. Over the years, Keppel Shipyard has delivered a number of FPSO and FSO units to Malaysia. For instance, FSO Sepat, which was delivered last year, has been deployed by Petrofac in the Sepat field. Besides FPSO Berantai, Keppel Shipyard s other ongoing conversion project for Malaysia is the LNG FSU Tenaga Empat project. Mr Nelson Yeo (right), MD of Keppel Shipyard, and Mr Tong Chong Heong (second from right), CEO of Keppel O&M, share on Keppel Shipyard s safety journey with (from left) Lady Sponsor Puan Hatijah Abdul Latiff and Guest-of-Honour Encik Ramlan Abdul Malek, VP, Petroleum Management, PETRONAS keppelite

21 Sustaining Growth 21 Stream of projects to N-KOM Winning the trust and confidence of customers in the region, Nakilat-Keppel Offshore & Marine (N-KOM) is continuing to build on its strong track record for quality deliveries as well as expand on its range of capabilities. The yard recently undertook its first jackup project with international drilling rig owner and operator, Ensco plc (Ensco). It has also been awarded repair and maintenance contracts for three other Ensco jackups, which will call at N-KOM in the coming months. On 25 March 2012, N-KOM completed general repairs on Rowan California for Rowan Companies. This was the second time the jackup was at N-KOM following its smooth repair session in July As a specialist in liquefied natural gas (LNG) repairs, N-KOM has undertaken a steady stream of LNG projects. In April 2012, N-KOM delivered Mozah the largest LNG carrier in the world and Al Jassasiya to STASCo (Shell) and Maran Gas Maritime respectively. Turning in an exceptional performance on the latter project, N-KOM received an early delivery bonus from the vessel s manager, Maran Gas Martime. keppelite ENSCO 91 is one of four jackups from Ensco that will undergo upgrading, repair and modification works at N-KOM Safe operations Bumi Armada presents Keppel Shipyard with a safety bonus of US$15,000 for its strong safety performance on the Armada Sterling project With a safety-first modus operandi, Keppel Shipyard has achieved one million safe man-hours on the Floating Production Storage and Offloading (FPSO) vessel, Armada Sterling, and was presented a safety bonus of US$15,000 by Bumi Armada Berhad (Bumi Armada) on 23 April As longstanding partners, Keppel Shipyard and Bumi Armada have had good safety records on all their collaborations. Keppel Shipyard completed two projects for Bumi Armada in 2011 FPSO Armada TGT 1, which had been delivered with a record of 3.7 million s a f e m a n - h o u r s, a n d FSO Sepat, which clocked more than one million safe man-hours. Chartered by Oil and Natural Gas Corporation Limited, Armada Sterling will support production activities in India s D1field. The FPSO is scheduled to leave the yard in 4Q keppelite

22 22 Sustaining Growth Riding on technological waves As the search for hydrocarbons in challenging frontiers continues, driven by unabated global energy demand, the industry has intensified focus on enhanced rig safety and specifications. Mr Aziz Merchant, ED of Keppel FELS (Engineering), Keppel s Deepwater Technology Group and Keppel Offshore & Marine Technology Centre (Deepwater Technology), recently shared on the growing demand for more technologically advanced rigs with Upstream and AsianOil Week. The global drive to find new deepwater deposits has opened up opportunities for rig builders as operators and owners scuttle to replace aging vessels with more technologically advanced models. Keppel Offshore & Marine is strongly positioned to ride the next wave of demand for high specification rigs, tailored not only to meet higher technological requirements posed in the wake of the Deepwater Horizon incident but also to inhospitable climates. Mr Merchant shared that the industry is looking to increase systems redundancy and automation, hence rigs have to be re-engineered for greater efficiency to carry more and larger equipments onboard. Mr Aziz Merchant, ED of Keppel FELS (Engineering), Keppel s Deepwater Technology Group and Keppel Offshore & Marine Technology Centre (Deepwater Technology) shared expert views on technology innovations that support safe and efficient deepwater exploration He said, Designing and building new exploration and production rigs come with its own challenges. Authorities managing exploration in the harsh-environment hydrocarbon basins as well as rig owners, are calling for state-of-the-art technologies, though not many of us know the surprises from drilling ultra deepwater wells. Keppel FELS is now working w i t h r i g o w n e r s a n d operators to develop a raft of solutions to counter any new environmental surprises. The company has also developed two updated semisubmersible rig designs DSS 38E and DSS 51HE in response to recent inquiries for new drilling demand off Brazil and in the North Sea respectively. Both rigs would be able to accommodate a minimum six-ram blowout preventer (BOP), which Mr Merchant flagged as a new industry standard. Most of the semisubmersibles active in the North Sea are third and fourth-generation r i g s e q u i p p e d w i t h four-ram BOPs. There is an emerging need to renew the semisubmersible fleet in the North Sea partly because these rigs cannot be upgraded to six-ram BOPs. Oil and gas companies are also looking to increase drilling efficiency in the region as some of these rigs operate at only 50% uptime during winter seasons. The DSS 51HE also comes with an available option to upgrade to a seven-ram BOP unit. As with the DSS 51 series of benign-environment semisubmersibles built for Denmark s Maersk Drilling, the latest DSS 51HE design boasts a dual-derrick system aimed at increasing productivity of drilling operations. Mr Merchant added, Moving forward, we envision the new-generation semisubmersible and drillship designs to operate in even deeper depths and at higher temperature and pressure levels. Also, we need to apply market knowledge and technology expertise innovatively to a variety of offshore applications. keppelite

23 Sustaining Growth 23 Experienced leaders onboard Mr Daniel Chan, Mr Lee Chiang Huat and Mr Lor Bak Liang As part of its efforts to further strengthen its Board, K-REIT Asia Management Limited (KRAM), the Manager of K-REIT Asia, has appointed three Independent Directors Mr Daniel Chan, Mr Lee Chiang Huat and Mr Lor Bak Liang with effect from April Mr Daniel Chan, 60, is the founder and MD of DCG Capital Pte. Ltd., an exempt fund manager under the Monetary Authority of Singapore. With more than 30 years of experience in the financial industry, he has served as Chief Investment Officer at UOB Asset Management from 1986 to 2004 and Lion Global Investors from 2005 to Mr Chan was conferred the distinguished Financial Industry Certified Professional award by the Institute of Banking & Finance in Mr Lee Chiang Huat, 62, was previously the CFO of NOR Offshore Ltd, a Singaporebased company providing a range of marine support services to the offshore industries. Prior to that, Mr Lee held several senior positions and directorships with Singapore Petroleum Company before he retired as Senior VP and CFO in March Mr Lor Bak Liang, 55, was with GIC Real Estate Pte Ltd for 14 years where he was Executive VP and Head of Asset Management (Asia). He was also a member of the Management Committee, overseeing operational matters of the company as well as in the Investment Review Committee. Dr Tsui Kai Chong, Chairman of K-REIT Asia, said, We are privileged to have Daniel, Chiang Huat and Bak Liang join our Board. Their wealth of experience in the areas of finance, investment, as well as asset and fund management will contribute further to K-REIT Asia s strategic growth. Meanwhile, Dr Tsui Kai Chong and Mrs Lee Ai Ming will be re-designated as nonindependent directors with effect from 9 April Mr Tan Swee Yiow will also relinquish his role as alternate director to Mr Kevin Wong Kingcheung with effect from 9 April With these appointments, the Board of KRAM will have a total of nine directors, o f w h o m f i v e a r e independent directors. keppelite

24 24 Sustaining Growth Flow of insights BG(NS) Tay Lim Heng, CEO of Keppel Integrated Engineering (KIE) and Mr Thomas Pang, CEO of Keppel Infrastructure Fund Management (KIFM), Trustee-Manager of K-Green Trust spoke at the Water Infrastructure Indonesia conference held on 27 to 28 March 2012 in Jakarta. Keppelite reproduces excerpts from their interviews that were conducted as a lead up to the conference. Creating sustainable solutions What are the challenges in creating a new source of water as a sustainable solution? TLH: There are complexities in terms of financing and project design, as well as social and environmental considerations. In today s economic climate, many government agencies face tight public funding and resource constraints. A sound government policy framework sets the stage in encouraging investment in water projects. The private sector, on the other hand, can contribute by helping to finance or execute the projects. What are the key challenges faced by KIE in water infrastructure projects, and how is KIE devising effective strategies to overcome them? TLH: A key challenge lies in the development of more efficient technologies for water treatment. Many of the technologies needed to address water security already exist but need to be refined or improved. To address this, Keppel Seghers constantly improves on our solutions and finds new ones through our R&D centres (the Centre of Excellence in Belgium and Keppel Environmental Te c h n o l o g y C e n t re i n Singapore), making sure our clients are given the most reliable, cost-effective and advanced solutions at all times. What are some of the yet to be explored opportunities in the Asian water infrastructure sector? TLH: Many countries in Southeast Asia such as Indonesia, Vietnam and the Philippines need solutions in water and wastewater treatment. Rising affluence and urbanisation have also led to the increased demand for water and investment in new water schemes to keep pace. The Ulu Pandan NEWater Plant is an example of a successful Public-Private-Partnership project As the service provider of environmental and water

25 Sustaining Growth 25 projects, KIE seeks to explore business opportunities with governments in the region to play a part in providing a sustainable water supply for local communities. What future trends will be seen in wastewater recycling and management in Asia? TLH: Water scarcity has resulted from rapid urbanisation in many countries. This scarcity fuels growth for potable w a t e r s o l u t i o n s a n d wastewater management. At the same time, governments have become m o r e a w a r e o f t h e impending threat of water scarcity and have started to implement policies which take into account the need for urban development and proper environmental management. In Indonesia, it was reported that many water-related Public-Private Partnership (PPP) projects could be introduced in the next four years. P P P i n i t i a t i v e s a r e increasingly accepted as viable options to address funding needs. The private sector can play an important role in driving the cost efficiency of water treatment technologies. Investing in water infrastructure What are the most common challenges when investing in water infrastructure projects? TP: Public water infrastructure projects and their privatisation have always been a sensitive issue due to public expectations on their pricing. Therefore tariff adjustments often face political resistance which result in under-recovery of costs and ultimately, underinvestment of public water infrastructure projects. High political and regulatory risks make long-term investments in water infrastructure very difficult to assess. In many countries, water is viewed as a public right with the provision of water services subsidised. Governments often face the challenge of cost recovery. This challenge is passed on to investors when water services are privatised, because the public has grown accustomed to not paying the economic price of water. This mindset makes the cost for wastewater treatment, which is higher, even more difficult to recover. In countries where enforcement As the service provider of environmental and water projects, KIE seeks to explore business opportunities with governments in the region to play a part in providing a sustainable water supply for local communities. BG(NS) Tay Lim Heng CEO of KIE of discharge standards is difficult, wastewater treatment services are commercially unviable, especially when the easier alternative is to discharge without treatment. How difficult is it to evaluate the long-term investment for water infrastructure projects in Indonesia? TP: As existing projects are developed, owned and operated by municipalities, there are not many operational water infrastructure projects available for investment. Another factor that complicates the evaluation is that many municipalities are not able to recover the full costs for the provision of water service due to inability to collect payments, water losses in transmission and inadequate metering, among other problems. If these issues are not resolved, private sector participation will be very difficult. In addition, because of the need for foreign sourced financing, project lenders still require national guarantees on payment. What are K-Green Trust s methodology and evaluation criteria in choosing potential investment projects? TP: K-Green Trust looks to invest in operational projects that have longterm (eg. 20 years) offtake agreements with creditworthy counterparties such as governments, preferably with capacity based payment mechanisms and inflation adjustments. There should also be a clear regulatory framework in place, with long-term and consistent policies to reduce regulatory risks. keppelite TLH BG(NS) Tay Lim Heng, CEO of Keppel Integrated Engineering TP Mr Thomas Pang, CEO of Keppel Infrastructure Fund Management

26 26 Special Focus Inspiring Keppelites The inaugural Outstanding Keppelite Awards were presented at the Carlton Hotel on 23 March 2012 Keppel values and nurtures our people and that is what allows us to harness the collective strength that is a Keppel hallmark. With these words, Mr Choo Chiau Beng, CEO of Keppel C o r p o r a t i o n, o p e n e d the session for the ninth Grow Beyond talk, a series organised by Keppel College to engage t a l e n t s a n d p r o m o t e knowledge sharing. More than 300 Keppelites convened for the talk held at the Carlton Hotel on 23 March They also turned up in force to cheer on some twenty over fellow colleagues who were commended at the inaugural Outstanding Keppelite Awards. Mr Choo explained the rationale for the conception o f t h e Aw a rd s, T h e Outstanding Keppelite Awards recognise Keppelites who exemplify our core values. In addition to consistent o u t s t a n d i n g w o r k performance, the winners a n d n o m i n e e s a r e inspirational role models for all of us. Recipients of Outstanding Keppelite Awards 2012 Keppel Data Centres Investment Management Yeo Shengyan, Lionel AVP Keppel Digihub Toh Ban Lee, Thomas Assistant Manager Keppel FELS Mohd Sahlan Bin Salleh AGM Goh Han Bin, Max Assistant Shipyard Manager Teo Sin Leong, Ivan Assistant Project Engineering Manager Siek Weiying, Wayne Senior Project Superintendent Keppel FMO Sim Poh Heng AGM Keppel Land Goh Han Kee DGM (Projects) Wee Boon Leong AGM (Investments) Koh Hui Hwa, Doreen Senior Manager Toh Kah Fai, Collin Manager Goh Choon Kim Assistant Manager Yang Bo Assistant Director, Keppel Land China Keppel Logistics Wu Di, Nelson Senior Manager Yee Cheng Foong Manager Keppel Seghers Cheang Whye Theng Senior Plant Manager Balasubramanian Rajendran Project Manager Keppel Shipyard Poh Leong Kok SVP Lim Shaw Chuan, Ivan AGM Leong Kok Weng Senior Project Manager Keppel Singmarine Cong Yu Jie Senior Manager Loh Kee Huat Assistant Yard Manager and GM of Prime Steelkit

27 27 Our model Keppelites share on what makes them go that extra mile and inspire them to serve with passion. Keppelite will feature their stories over a few issues. Support from colleagues and family enables Poh Heng to achieve greater heights Sim Poh Heng, AGM at Keppel FMO, paid tribute to the strong support from family and colleagues. He shared a recent experience when he was asked to relocate to Qatar to mobilise and ramp up the operations at the Katara Cultural Village within a very tight time frame. He was momentarily held back by family concerns because his wife was then juggling between a mid-career switch and the needs of their toddler. However, his wife and family were very supportive of his endeavour. His supervisor also supported him by making arrangements to allow him to fly back periodically to take care of his family. He was therefore able to concentrate on work in Qatar while continuing to ensure that operations in Singapore ran smoothly with his team s help. Max thrives on the positive vibes at his workplace Max Goh, Assistant Shipyard Manager at Keppel FELS, is motivated by the positive vibes generated by likeminded colleagues at his workplace. It is important to like what you do, he shared. He also appreciated the patience of his seniors when he was the new man learning the ropes. In turn, he has gladly taken up the role of mentor to share his experience and help team members perform better. Kee Huat advocates values that he feels are hallmarks of Keppel s success Loh Kee Huat, GM of Prime Steelkit and Assistant Yard Manager at Keppel Singmarine, appreciates Keppel s enduring core values. He observed that Keppelites have a Can-do! spirit and no qualms about taking on difficult challenges headon, but are yet practical and prudent at the same time. He was thankful that he had picked up good attitudes and values from his mentor early in his career. He now advocates the same values to the younger engineers that he works with. Technical competence is easy to learn once you ve acquired the right values, he explained. Doreen encourages Keppelites to be genuine and sincere in service Doreen Koh, Senior Marketing Manager at Keppel Land, has also recently entered into Keppel Land s Hall of Fame for exemplifying the core value of Passion. Apart from appreciating her colleagues for her nomination, she is also grateful to her customers and her bosses for their positive feedback. She encourages Keppelites to be genuine and sincere in service. I consider it my privilege and pride to market such an iconic development such as Reflections at Keppel Bay, which really reflects Keppel s commitment to excellence, she shared. Continues on page 28...

28 28 Special Focus...continued from page 27. Peak performance Best-selling author and motivational trainer, Adam Khoo shared insights in a lively presentation to Keppelites on how to Master Your Mind for Peak Performance. Your mindset determines the thoughts you have. Your thoughts determine your actions. Your actions influence the results you get, he enthused. He went on to share that for businesses to be successful in today s competitive environment, they would need to go the extra mile to deliver beyond customer s expectations. On the personal front, Adam encouraged the audience to take personal responsibility for their own destinies, rather than to give in to the temptation of blaming providence. Reflecting on the talk, Lionel Yeo, Assistant VP at Keppel Telecommunications & Transportaton, said, The talk was enriching. I liked the emphasis Adam placed on taking personal responsibility for our own lives and making life happen rather than thinking that life happens to me. I also feel that the strategy of striving for quantum goals goals that benchmark the best and stretch us is relevant to corporations as well as individuals. keppelite Keppelites enjoyed the lively talk by Adam Khoo on how to Master Your Mind for Peak Performance!

29 Sustaining Growth 29 Execution focus Be it newbuilding or repair of rigs, Keppel FELS expertise in execution has earned the trust of repeat customers and continues to keep the yard safe and on schedule amidst heavy workload. As good as new Keppel FELS has maintained a healthy workload of repair jobs including rigs of other designs originally built in other yards. It will be undertaking the upgrade and modification of Harukyu 10, a jackup based on the Baker Marine Class 375 design for repeat customer, Japan Drilling Company. Built in 2008, Harukyu 10 is estimated to arrive in May 2012 from Spain. The yard is also completing the repair of ENSCO 85, a LeTourneau 116-C rig, which is expected to be delivered at the end of April The major scope of work includes hull steel renewal, piping and electrical work as well as the refurbishment and upgrading of mechanical and drilling equipment. Keppel FELS recently completed major repairs on GSF rig 140, a F&G Enhanced Pacesetter 9500 semisubmersible, for Transocean, on time and without lost time incidents (LTI). The excellent track record has been demonstrated on other repair projects as well. These include the repair of a leg chord on West Cressida, a BMC 375 jackup, the refurbishment o f D o o S u n g, a F & G Enhanced Pacesetter L-907 and major repair work on J a c k B a t e s, a F & G Tr e n d s e t t e r L semisubmersible. Safety on double duty T h e y a rd s c l o c k w o r k construction capability was further demonstrated when it successfully undocked Transocean s two KFELS Super B Class jackup rigs under construction, B326 and B327 from its drydock on 20 March. Despite being larger than a typical KFELS B Class jackup, the twin KFELS Super B class rigs had completed their drydock assembly in 45 days, the same time it would normally take for a B Class rig. Keppel FELS Project M a n a g e r S h a w n Ye o attributed it to excellent teamwork between Keppel and Transocean and the improvements in processes and construction. Mr Ray Campbell, Transocean s Project Manager, said, I would Keppel FELS expertise in repair projects includes rigs of competing designs originally built at other yards. West Triton, a BMC 375 rig similar in design to Harukyu 10, underwent repairs and upgrades at Keppel FELS in 2010 like to thank the respective teams for a job well done. Getting both B326 and B327 out of the drydock in the short time frame required outstanding commitment, planning and performance. Most importantly this was accomplished while upholding a very high safety standard and without a recordable incident. Being built simultaneously, the two rigs are on track for delivery in 2H The rigs have also achieved a combined safety milestone of four million manhours without LTI. keppelite

30 30 Sustaining Growth Eco-City on track Mr Lee Yi Shyan, Singapore s Minister of State (MOS) for Trade and Industry and National Development, visited the Sino-Singapore Tianjin Eco-City (Tianjin Eco-City) on 26 March During his trip, he called on Mr He Lifeng, Deputy Secretary of CPC Tianjin Municipal Party Committee and Party Secretary of the Tianjin Binhai New Area. MOS Lee was updated on the good progress achieved and new amenities offered by the Tianjin Eco-City. Mr He also shared that plans for an eco-friendly transport network to link the Tianjin Eco-City to the rest of the region is being reviewed by the Chinese central government and that local authorities intend to build a small section as a pilot project to demonstrate the viability of green transport. Together, MOS Lee and M r H e w i t n e s s e d t h e groundbreaking ceremony for the Low Carbon Living Lab (LCLL). The LCLL, located within the Eco-Business Park, is jointly developed by Tianjin Eco-City Investment and Development Co. Ltd. (SSTEC), the Building and Minister Lee Yi Shyan (fourth from left) and Mr He Lifeng (fifth from right) at the groundbreaking of the Low Carbon Living Lab Construction Authority (BCA) of Singapore and International Enterprise Singapore. The LCLL will test-bed and demonstrate green building features, energy saving building technologies and renewable energy adoption. SSTEC is the master developer of the Tianjin Eco-City. It is a joint venture between a Chinese consortium and a Singapore consortium led by Keppel. keppelite People matter In a trip to Tokyo, Japan, from 26 to 27 March 2012, Keppel Corporation s CEO and Keppel Land s Chairman Mr Choo Chiau Beng (fourth from right) met with colleagues at Alpha Investment Partners (AIP) Japan, a unit headed by Mr Mikami Asao, President & CEO (fifth from right). Accompanying Mr Choo were Keppel Corporation s CFO Mr Loh Chin Hua (extreme right) and Director of Group Corporate Affairs Ms Wang Look Fung (third from right). Japan accounts for 22.4% of AIP s net value of assets under management of US$2.5 billion as at 31 December There are seven staff at AIP Japan, all of whom are locals there. keppelite

31 Sustaining Growth 31 Deepening ties The Keppel Group continues to welcome guests and business associates to its global facilities and operations to promote greater mutual understanding and stronger ties. China calls Dr Lee Boon Yang, Chairman of Keppel Corporation, and senior representatives across the Keppel Group hosted a delegation from China- Singapore Suzhou Industrial Park (SIP) to dinner on 10 April 2012, renewing ties with the Sino-Singapore landmark project. Brazil buzz Over at Keppel Offshore & Marine s BrasFELS yard in Angra dos Reis, Mr Kwok Kai Choong, CEO of Keppel FELS Brasil, hosted Petrobras new President and CEO, Ms Maria das Graças Silva Foster, on her visit in March This is a real shipyard, she said. During the tour, she learnt about the yard s track record and was impressed with Keppel s belief in Brazil since 2000 when it first took over the former Verolme yard. BrasFELs has since become the most established shipyard in the Southern Hemisphere with comprehensive facilities including a training school. Ms Graças Foster visited the training school and spoke with some of the apprentice trainees. She also had a chance to see the projects in progress at the yard, including the integration of the Floating Production Storage and Offloading (FPSO) vessel, Cidade de Sao Paulo, the fabrication of the module blocks for FPSO Cidade de Paraty as well as the P-61 lower hull construction. keppelite Led by Mr Du Jianhua, Chairman of China-Singapore Suzhou Industrial Park Development Group Co. Ltd. (CSSD), the 16-strong delegation was in Singapore for training. The dinner was held at the Island Suite, Marina at Keppel Bay, where delegates enjoyed the view of the world-class marina and waterfront developments. Keppel s relationship with Suzhou began 18 years ago when Keppel led the Singapore consortium in the initial development phase of the SIP. Today, the project has achieved significant growth and has developed into a world-class development zone. Dr Lee Boon Yang (third from left) welcomes Mr Du Jianhua (second from left) and his delegation at Marina at Keppel Bay Petrobras new President and CEO, Ms Maria das Graças Silva Foster (fourth from left) was impressed with BrasFELS during her visit in March 2012

32 32 Sustaining Growth Choice yard Keppel Shipyard received a strong vote of confidence at Seatrade Asia Awards 2012, where it was conferred the Repair Yard Award, edging out other competitors in the region. The award was presented to Keppel Shipyard for its high quality repair work, strong delivery track record and commitment towards safety. In addition, Keppel O&M had sponsored the Wet/ Dry Bulk Operator Award for Seatrade Asia Awards The award ceremony, held in Singapore on 23 April 2012, was well-attended by over 500 business leaders and industry executives. keppelite Mr Nelson Yeo, MD (Marine) of Keppel Offshore & Marine (Keppel O&M) and MD of Keppel Shipyard, said, It is through the feedback and support of our customers and business partners that we have been able to enhance our range of services over the years and we will continue to strive for better performances. Each year, Keppel Shipyard repairs and refurbishes an average of 400 vessels, spanning tankers, container ships, dry cargo vessels, gas carriers and offshore support vessels. Mr Nelson Yeo (centre), MD (Marine) of Keppel O&M and MD of Keppel Shipyard, received the Repair Yard Award on behalf of Keppel Shipyard at Seatrade Asia Awards 2012 The yard is also the preferred partner for the conversion and upgrading of Floating Production Storage and Offloading units, Floating Storage and Offloading vessels and Floating Storage and Regasification Units. The trusted name for the repair and refurbishment of a diverse range of vessels, Keppel Shipyard handles an average of 400 of such projects in a year

33 Sustaining Growth 33 School of hard knocks Mr Tong Chong Heong, CEO of Keppel Offshore & Marine (Keppel O&M), started his career in Keppel as a Foreman Engineer in the 1970s before rising through the ranks. In an interview with Upstream, he talks about his growth and vision for the company. Keppelite highlights extracts from the article. Mr Tong did not receive any formal training as a naval architect but graduated as he calls it, from the school of hard knocks, learning the trade with Keppel Shipyard in the 1970s. He took over the baton as Keppel Offshore & Marine s chief from Mr Choo Chiau Beng, current CEO of Keppel Corporation, in His first two years at the helm saw the group achieve record high orders and profit margins. Not one to rest on his laurels, Mr Tong says success is never a given and the challenge is to stay fit and trim to win more jobs and execute them well, on time and within budget. This was in light of the downturn in rig building activity in the 1980s which pushed some US yards into Mr Tong rose from a foreman engineer in Keppel Shipyard to become the CEO of Keppel O&M bankruptcy and Keppel Shipyard s rig building subsidiary, then known as Far East Levingston (FELS), was losing money and losing people, as Mr Tong recalled. As well as some of their peers, Mr Choo and Mr Tong were then brought in to take control of the situation and turn the tide. FELS diversified its business and won an order from Consafe to build a s e m i s u b m e r s i b l e accommodation platform. H o w e v e r, t h e K e p p e l team was not content to continue only with offshore construction work. FELS began to develop its own design after acquiring the proprietary rights to the Friede & Goldman Mod V jackup rig design which eventually evolved to become Keppel s KFELS B Class jackup, the industry benchmark design. Taking control of the rig design process was instrumental in Keppel s rise as a leading rig builder and its continued success 20 years later. The Singapore rig builder was able to win orders from Norwegian outfits willing to invest in innovative ways of drilling. Mr Tong remains optimistic on newbuild orders for jackup rigs. By the time the next batch of newbuilds are delivered, more than half the rigs [already in operation] will be over 30 years old, he said. Mr Tong also sees room for expansion in the global mid-water semisubmersible fleet, which, he felt, has not attracted sufficient attention during the latest newbuilding upturn that began in late 2010 through to As with its chief executive, Keppel O&M has few qualms about taking on new challenges in what observers once called a sunset industry. Mr Tong credits Keppel s success in turning the tables to the Can-do! spirit of a dedicated team. He has no regrets spending his career building and establishing Keppel and expanding the yard operator into a leading rig builder. Mr Tong has three children and four grandchildren. keppelite

34 34 Sustaining Growth Distinction for progress In recognition of its outstanding contributions to Singapore s economic growth and its commitment to promote the country s social and community interests, Keppel Offshore & Marine (Keppel O&M) was conferred the Distinguished Partner in Progress (DPIP) award by the Singapore Economic Development Board (EDB). Mr Tong Chong Heong, CEO of Keppel O&M, received the award from Deputy Prime Minister and Coordinating Minister for National Security and Minister for Home Affairs, Mr Teo Chee Hean, in a ceremony on 28 March Mr Tong said, This award attests to our relentless efforts to strengthen the industry in Singapore, improve our operational Keppel O&M s CEO, Mr Tong Chong Heong (right), received the Distinguished Partner in Progress award for the company s contributions to the Singapore economy from Deputy Prime Minister and Coordinating Minister for National Security and Minister for Home Affairs, Mr Teo Chee Hean e x c e l l e n c e, m a i n t a i n technology foresight and nurture people to sustain our growth. We are thankful for the strong support from EDB which has helped us become a global leader in the offshore and marine industries. A rising tide lifts all boats, and through public-private collaborations, we can enhance Singapore as well as our own competitive edge worldwide. Since its inauguration in 1991, the DPIP award has been conferred to 24 companies with Keppel O&M being one of the first local firms to be bestowed. keppelite Leading a new team In keeping with Keppel Land s commitment towards sustainability, a new division Sustainable Design & Knowledge Management, has been created to reinforce the company s efforts in this area. Mr Lim Tow Fok rejoined Keppel Land to lead this unit as its GM with effect from 9 April This new division was set up to synergise the company s existing sustainable design functions with the new Knowledge Management unit aimed at improving b u s i n e s s p e r f o r m a n c e through the strategic management of knowledge assets. keppelite

35 Sustaining Growth 35 Definitively Keppel Sound, Strategic, Disciplined, Driven and Sustainable these descriptives were used to help define what is Definitively Keppel in Keppel Corporation s 2011 Annual Report. Communicating our growth story in the annual reports anchored on the theme, Definitively Keppel, the Group Corporate Communications team at Keppel Corporation worked with business units across the group on the family of annual reports. K e p p e l s g r o w t h a n d transformation have not been evolutionary but strategic and focused. Our distinctive Keppel culture and set of values have sharpened our competitiveness and continued driving growth. At Keppel, we believe in integrating sustainability into our work practices, including the way in which we present our company s annual reports. Since 2011, Keppel Group has started offering CD-ROMs as an alternative for its annual reports to shareholders. For 2012, the Keppel Group increased the roll-out of this initiative to five of its annual reports distributed to shareholders, with hard copies available upon request as required by SGX. In addition, responding to feedback, Keppel have also extended to shareholders the option to access these annual reports through these website instead of receiving the annual report, whether in CD-ROM or hardcopy. Beyond that, as part of our efforts to adopt environmental best practices, we have gone one step further to seek the widely-recognised FSC certification which ensures that the products used in the production of the printed annual reports are from responsibly harvested and verified sources. keppelite Keppel T&T publishes its first sustainability report Keppel Telecommunications and Transportation (Keppel T&T) is the first logistics and data centre company in Singapore to produce a sustainability report. For its inaugural effort, Keppel T&T has achieved a Global Reporting Initiative Application Level B for recording its sustainability performance in 27 different indicators. Mr Pang Hee Hon, CEO of Keppel T&T, said, Investors have in the past been very focused on The Keppel Group of annual reports are anchored on the theme, Definitively Keppel scrutinising the business and the financial returns of the company. They are beginning to realise the important role that the company can play towards the sustainability of the overall ecosystem in which the company and its employees operate in. Increasingly, they are keen to learn about how safe, ethical and green the company is. Keppel T&T believes that by disclosing our sustainability performance, we will be able to create long-term benefits for the company and our stakeholders. Keppel T&T s report covers its operations in Singapore, China and Malaysia. Notably, in 2011, the Group managed to lower its energy consumption by seven per cent, compared to a business-as-usual scenario. 15 per cent of its total waste produced was recycled. Two per cent of the energy consumed at its subsidiary, Keppel Logistics (Foshan), was from on-site renewable energy.

36 36 Sustaining Growth Reflections on the waterfront To celebrate the completion of the iconic Reflections at Keppel Bay, Keppel commissioned a 30-minute programme, Reflections on the Waterfront, on Channel NewsAsia. Viewers share their thoughts on the documentary as they traced the journey of a vision transformed into reality. Like what Daniel Libeskind s a y s, o n e m u s t f i n d something that strikes you in the heart and soul, and pursue it with passion! It s an adage that every stakeholder behind the creation of Reflections at Keppel Bay has embraced an unrelenting spirit that is now celebrated and remembered through the programme. Maria Lolita Lachica Producer, MediaCorp It is amazing to see how the historic Keppel Harbour has been transformed. Keppel has truly showcased its capabilities in creating world-class residences that put Singapore on the world map. Yusheda Yusoff Manager, Property Management, Keppel FMO Reflections at Keppel Bay is truly an architectural marvel. The towers seem to come to life as it soars into the sky and the luxurious interiors inspire one to own a home there. The development is a reflection of Keppel s ambition and aspirations, and I am truly proud to be part of the Group behind such an iconic property. Teo Wei Shan Accountant, Keppel Shipyard Mr and Mrs Winston Milner, happy homebuyers of Reflections at Keppel Bay, were featured in the documentary enjoying the waterfront lifestyle at the development Advocate for green buildings Recognised for its strong sustainability practices, Keppel Land was invited to share insights at the Improving the Business Case for Green Buildings in Asia panel discussion on 28 March Mr Tan Swee Yiow, President of Singapore Commercial, shared on Keppel Land s best practices and the importance of sustainability through the advancement of green buildings and policies. The panel discussion, held in conjunction with the inaugural Environment, Social and Governance Asia 2012 Conference, was attended by some 20 investors who noted that investments in sustainability reduce risks, particularly relating to energy prices, which in turn improves earnings. As part of the programme, Keppel Land hosted a tour of Ocean Financial Centre for participants to understand the green features and sustainable practices implemented at the office building. keppelite

37 Sustaining Growth 37 Boating bonanza by the Bay The picturesque and awardwinning Marina at Keppel Bay set the stage for the 20th edition of Boat Asia, Asia s largest and most prestigious boating show, from 12 to 15 April Held for the fifth time running at Marina at Keppel Bay, the show featured a line-up of more than 50 luxury yachts and showcased the best of Singapore s growing leisure marine industry. The event was opened to the chimes of bells rang by Guest-of-Honour, Mr Choo Chiau Beng, CEO of Keppel Corporation, Mr Anthony Lim, Commodore of Changi Sailing Club, Mr Francis Lee, Commodore of Raffles Marina, and Mr Tan Kay Toh, Commodore of Republic of Singapore Yacht Club. Mr Choo said, We are happy to host Boat Asia at Marina at Keppel Bay and to work with TMX Show Productions for the fifth year running. Boat Asia is one of the most highly-anticipated events in the boating industry in the region. Our partnership with TMX reflects our shared commitment to position Singapore as a leading s a i l i n g a n d b o a t i n g destination in Asia. Indeed, Singapore has seen increased interest in the boating lifestyle. Based on a report in The Straits Times, Singapore is a heavyweight in the Asian superyacht m a r k e t, c o m m a n d i n g a s i z e a b l e e s t i m a t e d share of US$45 million of the US$345 million-a-year market. Boating enthusiasts and visitors also had the chance to step onboard these vessels which ranged from super yachts and midrange power and sailing boats to speed boats and performance craft. Other highlights at Boat Asia included fashion showcases by Singaporebased Vietnamese designer, Trisha Vu and premier leisure and sportswear brand, Paul & Shark, tours onboard luxury yachts such as Sea Bear, a 130ft Westport superyacht formerly owned by golfing legend Jack Nicklaus, and a reappearance by the historic sailing yacht, Vega, which is now used to conduct humanitarian relief m i s s i o n s a r o u n d t h e Indonesian archipelago. keppelite Giving back Norwegian-built humanitarian vessel, Vega is a familiar visitor to Marina at Keppel Bay, having made the Marina its port-of-call when in the region. The 120-year-old sailing yacht, together with its volunteer crew, deliver 12 to 15 tonnes of donated tools, farming, educational, medical and IT supplies to some of Southeast Asia s poorest island communities. Asia s biggest and most prestigious boating show, Boat Asia, was held against the backdrop of the newly completed Reflections at Keppey Bay As part of Keppel s community outreach efforts, the Group rallied employees to donate generously in support of Vega s charitable cause. Keppelites responded with enthusiasm, and donated items including desktop computers, stationeries, school bags, sports equipment, digital cameras and musical instruments.

38 38 Empowering Lives Lives Welcome to the family Some 220 fresh-faced Keppelites converged in the Matrix Auditorium at Biopolis on 16 April 2012 to a warm welcome by senior management. The Group Orientation formally inducts new e m p l o y e e s i n t o t h e Keppel family and allows them to network with fellow newcomers across the different business units. Mr Choo Chiau Beng, CEO of Keppel Corporation, kicked off the event by highlighting the unique features of Keppel s culture. He said, People who get through the first few years in Keppel tend to continue staying for a long time, even though there are many other opportunities available to them. Once they find that the culture is suited for them, they continue to seek challenges with Keppel. Keppel Corporation s CEO, Mr Choo Chiau Beng (centre, in jacket) and Group Human Resources Director, Mr Chee Jin Kiong (left of Mr Choo) meet the new hires to hear their fresh perspectives Mr Choo also underscored some key values and attitudes that Keppelites should hold dearly passion, integrity, and a positive attitude. On management s views towards people development, Mr Choo reiterated, People are our most important asset. We must continue to develop, recognise and reward good people. H e c h a l l e n g e d t h e newcomers to put forth views and suggestions that will help the Company to innovate and adapt in the rapidly changing world. Reflecting on Mr Choo s remarks, newcomer Dr Liu Ming from Keppel Offshore & Marine Technology Centre said, I agree that the right cultural fit between the organisation and an employee is important as it greatly motivates the individual to excel for the long term. Participants were introduced to the various businesses in Keppel and toured key operational sites and workplaces. The fun and informative tours acted as good social ice-breakers and gave the new Keppelites a broad overview of the scale and scope of Keppel s activities beyond their respective business units. The visits to the yards amazed me as I learnt about the significant role Keppel plays in the global offshore a n d m a r i n e m a r k e t, enthused Jenny Gui, Human Resource manager from Keppel Telecommunications & Transportation. She added, I was also very impressed with the efforts they put into educating workers on safety. The use of simulated work sites to teach and test practical know-how is much more effective than solely focusing on theory or written tests. keppelite New Keppelites visit Marina at Keppel Bay (left) and a Keppel Logistics warehouse (right), among other sites, for a first-hand view of Keppel s various business activities

39 Empowering Lives 39 Walking the talk BG(NS) Tay Lim Heng, CEO of Keppel Integrated Engineering, shared on his diverse experience From policy formulation, business development and regulatory work to warfare strategies and weapon systems, BG(NS) Tay Lim Heng, CEO of Keppel Integrated Engineering, has a diverse gamut of work experiences from key appointments in the Ministry of National Development, Maritime and Port Authority of Singapore and the Singapore Armed Forces. Young Keppelites kept their ears peeled as he shared anecdotes and insights on leadership at the Keppel Young Leaders Leadership Series session held on 22 March Highlights from the session: What are the qualities of a good leader? A good leader walks the talk and leads by example, inspiring the rest of the team who will look to him or her for guidance and strength. When given an opportunity to lead, seize it and take it as a chance to grow and hone your leadership skills. Take on the leadership role with earnest sincerity and put in your best effort. Do not be afraid to make mistakes. You should not just focus on individual excellence but also on team effectiveness through synergising and leveraging the strengths of your team members. Assign the right people to the respective tasks after knowing and understanding the individuals and team dynamics. Through this, you will obtain a result that is bigger than the sum of its parts. Learn by observation, and also learn from decisions made, whether they are right or wrong. There is no single school of leadership or one formula in becoming an effective leader. Although Keppel s businesses are diverse in nature, we complement each another. United by our team spirit, we can galvanise our s t r e n g t h s t o a c h i e v e common goals. Your career has spanned various industries. Was it difficult to adapt? When you are given a new role and have new r e s p o n s i b i l i t i e s, t h e fundamentals of leadership are the same, even though the environment, content and people may differ. You have to plan, strategise, move in and take charge. However, bear in mind that to be effective, a leader has to adapt and adopt the style that is most appropriate for the circumstances. Who is the leader that inspires you the most? During my formative years, the leader who inspired me the most is none other than our former Prime Minister, Mr Lee Kuan Yew. He was a true leader and a masterful politician. His willingness to take on a greater cause, his ability to rise above his detractors, to inspire and empower creative people who were giants in their own rights to excel and work for him, laid the foundation that created modern Singapore. keppelite

40 40 Empowering Lives Developing global talents Through scholarships and bursaries, Keppel makes positive contributions locally and abroad to global talent development that drives growth for communities and industries as well as for its businesses. Industry development In collaboration with the Singapore Government, Keppel will be offering the Singapore Industry Scholarship (SgIS) aimed at nurturing a strong core of Singapore talent with the requisite skills and capabilities to steer and contribute to sectors that are critical to Singapore s economic and social progress. A t t h e S g I S F a i r a n d I n f o r m a t i o n S e s s i o n held at the Singapore Management University on 18 March 2012, Keppel Corporation s Group Human Resources department and Keppel Offshore & Marine training team reached out to interested students, providing them with a deeper understanding of the developmental opportunities at Keppel. Keppel Scholar, Wayne Siek, also shared with students and parents his experiences during his four years with Keppel. and Keppel Subic Shipyard congratulated four outstanding students from the NAMEI Polytechnic Institute Myra Mendoza, Alvin Kenneth Ilagan, Edgardo Flores, Jr. and Jonathan Baligad, who graduated with honours in Naval Architecture and Marine Engineering under scholarships by the Keppel companies. Mr Mok Khim Whang, P r e s i d e n t o f K e p p e l Philippines Marine, Inc. and Keppel Subic Shipyard, said, Through our scholarships in the Philippines, we are nurturing young talents who would otherwise not be able to attend college due to financial reasons. We hope that by providing them with opportunities for further education, they will be better able to carve a bright future for themselves and contribute to the offshore and marine industry. Magna cum laude graduate, Myra Mendoza is now a Management Trainee with Keppel Batangas Shipyard. Expressing her appreciation, she said, Keppel has been very generous and supportive throughout my five-year course. My family and I are very grateful to Keppel for giving me the opportunity to pursue tertiary education. keppelite Ms Chia Tsui Lin, Senior Manager, Keppel Corporation s Human Resources, sharing with students at the SgIS Fair and Information Session Graduating honours Over in the Philippines, Keppel Batangas Shipyard Agnes Barbara L. Lorenzo (extreme left), VP (Administration & Finance) of Keppel Philippines Marine, Inc., at hand to mark the graduation of Keppel Batangas Shipyard and Keppel Subic Shipyard s scholars

41 Empowering Lives 41 Orientated for growth Attracting and nurturing promising youths is part of Keppel s strategy to grow and cultivate a robust talent pipeline. As part of talent outreach efforts, over 60 potential Keppel Group Scholars were given a comprehensive o r i e n t a t i o n t o t h e Group s businesses on 3 April The prospective scholars toured some of Keppel s f a c i l i t i e s i n c l u d i n g Keppel Shipyard, Keppel FELS, Keppel Logistics warehouses, Keppel s district heating and cooling systems plant and Keppel Land s Ocean Financial Centre. They also heard first hand from current scholars on their experiences as Keppelites while Keppel Corporation s Group Human Resources s h a r e d a b o u t t h e Group s organisational culture and development opportunities. Within the Group, some 24 Keppelites were also being trained to become effective mentors. The workshop held on 12 April 2012 helped to build the skills required to help their mentees develop values aligned with Keppel s Core Values, to energise and assimilate them into the Keppel family. keppelite Prospective scholars learnt more about Keppel s businesses through tours to key facilities and sites Koen Dehaene (left), Facility Manager, receives the Safety Employee Award 2011 from Mr Ivan Christiaens, GM, for making Keppel Seghers Belgium a safer, happier and healthier workplace. Prevention is better than cure Koen Dehaene makes Keppel Seghers Belgium a happier and healthier workplace for his fellow colleagues. As Facility Manager, Koen takes care of the overall maintenance of the premises through regular inspections, repairs and preventive care of office equipment and machinery. As part of the safety committee, he also shares inputs and suggestions to mitigate safety risks. To commend his efforts, the company has conferred the Safety Employee Award 2011 and a 200 cheque as a token of appreciation to Koen. As he walks by the office corridors, he prowls for defects and opportunities for improvement, such as more ergonomic desktop arrangement, energyefficient lighting, better heating and ventilation to a constant supply of fresh coffee and beverages. H a v i n g w o r k e d w i t h Keppel Seghers for almost 20 years now, Koen has been involved in several projects, including solid waste and wastewater treatment sites as well as renovation of office buildings. In all these years, Koen has maintained a perfect personal safety track record as a result of the constant attention he pays to safety. keppelite

42 42 Empowering Lives Building bonds More than 130 Keppel Land China employees gathered i n S h a n g h a i f o r t h e company s inaugural Annual Staff Conference (ASC) to exchange knowledge, experiences as well as new ideas from 19 to 21 March In his opening address, Mr Ang Wee Gee, Executive Vice Chairman of Keppel Land China, thanked them for their hard work over the past year and urged all employees to work together to seize new growth opportunities. Keppel Land China employees from across the country gathered in Shanghai for the inaugural Annual Staff Conference long service awards to three loyal employees. The platform enabled participants to gain a sharper understanding of the company s strategy and imbibe updates on ongoing projects in China. The staff also benefited from training sessions such as those for mentoring and presentation skills. The ASC also gave them opportunities to network and forge stronger bonds. The ASC ended on a high note with Keppel Land China s first Dinner & Dance party held at the Hilton Hotel on 21 March More than 200 employees participated and enjoyed the cultural performances and team bonding activities. Mr Kevin Wong, Group CEO of Keppel Land, presented The longest service staff w a s n o n e o t h e r t h a n Mr Ang, who has been with Keppel Land for two decades since its days as Straits Steamship Land. He shared, My most rewarding moment is seeing my staff grow in their jobs, taking on greater responsibilities and contributing to the company over the years. Another recipient was Yu Xiaofei, Corporate Affairs Manager and Administration Manager who recounted her last 12 years with Keppel Land, Despite challenges and obstacles faced along the way, I am very happy to work in Keppel where there is a fair and meritocratic culture as well as a friendly and energetic working environment. I treasure the opportunities to work closely Mr Ang Wee Gee, Executive Vice Chairman of Keppel Land China (left), received his 20-year Long Service award from Mr Kevin Wong, Group CEO of Keppel Land with and learn from the management. Mr William Tan, GM, North China, also look forward to many more years of service, adding, The past decade with Keppel Land has been both exciting and challenging. I am proud to be part of the pioneering team which has witnessed and participated in the growth of the company s business in China. 11 years is only a start for many long serving staff in Keppel and I look forward to my 20-year service award! keppelite

43 Empowering Lives 43 Riding the Pacific waves Race 9 of the Clipper Round the World Yacht Race from Qingdao to Oakland, California, proved the mettle of the crew onboard the Keppelsponsored Singapore boat. Braving two-storey high waves, freezing temperatures and even a man-overboard incident, the team battled the elements over 6,000 miles across the Pacific Ocean in the toughest leg to take second place, their best-ever finishing position in the series. Congratulating Skipper Ben Bowley and the crew on a well-executed race, Keppel Group Corporate Affairs Director, Ms Wang Look Fung, said, Despite the gruelling conditions that the Pacific Ocean is known for, the team has exemplified the Keppel Can-do! spirit and overcame all odds to secure a commendable podium win. Keppelites are proud to be associated with the spirit of achievement, tenacity, perseverance and teamwork that saw the whole crew through the ups and down in this leg, which is the toughest in the whole race, she added. The Singapore crew was ecstatic as they crossed the finish line at the iconic Golden Gate Bridge and on their arrival in Jack London Square. Skipper Ben said, It has been an epic race; by far the most challenging thing I ve ever done, and certainly all the crew will agree that it has been the most challenging thing that they have ever done. After an arduous 28 days crossing the mighty Pacific Ocean, in which they also picked up an extra two points at the scoring gate off the coast of Japan, Singapore is now in fourth place overall and just three points adrift of an overall podium place with six races to go before the end in Southampton in July. Round-the-worlder Singapore student Sherlyn Chen acknowledged that the collective strength of the team helped the team to achieve their highest goals. She said, I feel very proud. Every single one of us that has been on this leg has done something very few people have done, so it s truly a great achievement. The ten-strong fleet is now racing towards Panama, a few degrees north of the Equator, where they face changing weather conditions with rising temperatures and light winds. S i n g a p o re i s k e e n t o continue their climb of the leader board as Race 10 gets underway. Ben said, We had an excellent result in the last race and we hope to keep up the drive and keep everyone moving and motivated. We are feeling confident and are going to keep on pushing. We only have three points between us and Visit Finland, so we need to keep the consistency going and keep putting in the good results, so we can remain at the top of the leader board. The jubilant crew onboard Singapore after crossing the finishing line in second place at the Golden Gate Bridge in San Francisco Go Singapore! keppelite

44 44 Empowering Lives Roar and row With fearsome drumbeats, mighty chants and intense camaraderie, the Keppel Dragons clinched the Silver Medal in the inter-corporate category of the MR500 dragon boat race organised by SAVA Pte Ltd on 17 March Darryl Tai, Captain of Keppel Dragons and Senior Engineer at Keppel FELS, enthused, We are thrilled that our trainings have paid off. The team has worked really hard for every race we participated in. Keppel Dragons has brought together a group of Keppelites who share a Can-do! spirit. We will work harder for the upcoming races. Initiated as a teambuilding activity for Keppelites to build camaraderie, Keppel Dragons has evolved into a competitive racing team taking part in various competitions, engendering pride and winning trophies for Keppel. keppelite Pulses raced as the 11-strong team pitted their rowing skills against nine teams in the semi-final race. Neck to neck against four other teams in the final race, the Keppel Dragons charged forward in unison, edging out their competitors to emerge second place. Keppel Dragon (boat 3) finished second in the MR500 dragon-boat race Platform for friendship To encourage a healthy lifestyle and team-bonding, Keppelite Recreational Club (KRC) has organised weekly table tennis games, also known as ping-pong, at Clementi Sports Complex for the year. More than 30 enthusiastic To encourage a healthy lifestyle and team-bonding, Keppelite Recreational Club has organised weekly table tennis games at the Clementi Sports Complex for the year Keppelites bonded over ping-pong at the games which started on 22 March A s p a r t o f K e p p e l Corporation s sponsorship of $300,000 to the Singapore Table Tennis Association, Keppelites can now enjoy the sports hall facilities every Thursday from 6pm to 9pm. Ainon Bte Haji Mohamad Taib, convener for KRC table tennis 2012 games, shared, We believe table tennis games are a great platform for Keppelites to bond and display sportsmanship. It also embodies the Keppel core values of passion, teamwork and commitment. Sun Long, Senior Engineer from Keppel Singmarine, enthused, I look forward to these games every week as it allows us to bond together and meet new friends. I will encourage more Keppelites to participate in the games. The table tennis games are open only to KRC members. To join, Ainon at Ainon@keppelshipyard.com. keppelite

45 Empowering Lives 45 Keppelites Abroad Braving new worlds A flair for languages enables Polish-born Mariusz Maciejewski, 40, to traverse diverse terrains over the course of his career. His fluency in Polish, German, English and Russian, and his appreciation for diverse cultures have allowed him to build an exceptional personal and professional track record of having done business in more than 40 countries. He joined Keppel in 2009 with a background built on the back of strong operational and industrial sales experiences garnered across varied markets including China, South Korea, Russia, Uzbekistan, Turkey, Iran and Poland. Currently, as Sales and Business Development Manager for Keppel Seghers GmBH in Langenfeld, Germany, Mariusz oversees the company s business presence and interests in all German-speaking countries and Eastern Europe. While his linguistic prowess has been helpful to his work, it takes more than Work hard and play hard Mariusz and his wife tucking into Alaskan crabs while on holiday just proficiency in different tongues to do well in foreign territories, he shared. I ve learnt to be sensitive to the differences in business practices and ethics as well as the different interpretations of nuanced communications such as body language in different cultures. All these are important dimensions in relationship-building when doing business in another country, explained Mariusz. For example, Mariusz recounted his surprise at the relaxed dress code in Keppel Seghers Belgium office, which was also adopted by management representatives. This was a refreshing discovery as he was used to the formal attire usually observed by German management. He added, I am also constantly paying close attention to regional and local politics, market trends and developments in order to gauge rising opportunities and to feel the pulse of prospective markets. Indeed, one of the markets growing in relevance and interest for Mariusz is Eastern Europe. With their accession to the European Union (EU), the countries of Eastern Europe are committed to the EU directive on waste management. Diversion of waste away from landfill is an important element. As such, in Poland alone for example, up to ten waste-to-energy f a c i l i t i e s h a v e b e e n planned for construction over the next few years, according to estimates by market watchers. While keeping close tabs on the prospects in Eastern Europe, Mariusz is equally watchful of the challenges and the potential pitfalls of venturing into new markets. For me and my team, it s a very exciting job. We keep our eyes peeled on opportunities as well as challenges in both mature and emerging markets across Central and Eastern Europe. We fully explore the risks and benefits to have a realistic grasp of the markets potential. With multi-lingual abilities and a multicultural mindset, Mariusz is well-set to brave new worlds and global markets for Keppel Seghers products and services. keppelite

46 46 Nurturing Communities Communities Beyond Earth Hour Business units across the Keppel Group supported Earth Hour on 31 March 2012 by participating in the first-ever Earth Hour human formation in Singapore More than 6,700 cities, towns and municipalities around the world took part in the biggest Earth Hour event on 31 March 2012 from 8.30 pm to 9.30 pm. I n S i n g a p o r e, 1, supporters took part in the first-ever Earth Hour human formation, in the shape of 60+ SINGAPORE at the heart of Orchard Road. Dr Vivian Balakrishnan, Minister for the Environment and Water Resources, was the Guest-of-Honour for the event and led the lights-out ceremony. Forming a contingent comprising more than 100 Earth Hour ambassadors, the Keppel Group gave shape to the digit 6 in the formation. For this momentous occasion, Keppel Volunteers also invited students from adopted charity, Association for Persons with Special Needs, to form the contingent (read more on page 51). On his participation, Michael Yeo, Principal Draftsman at Keppel FELS, said, An event of such prominence helps to raise awareness of climate change. Each and every one of us play an important role in conserving earth s resources. In participating in Earth Hour, I am signaling that I am committed to do my part to save the earth. Through the month of March, the Keppel Group rallied behind Earth Hour, engaging Keppelites in a variety of activities to provoke thought and action for conserving precious resources. At Keppel Offshore & Marine, all seven yards in Singapore, as well as its two shipyards in the Philippines switched off non-essential lightings (lightings that would not affect safety and security such as office lights, signages and lights in the open air car park) from 8.30pm to 9.30pm. Promotional

47 Nurturing Communities 47 activities for Earth Hour were also held at accommodation lodges for our foreign workers. These include the screening of a film on the environment, quizzes with prizes and having the lights out during the special hour. Across 34 of Keppel Land s commercial and residential properties as well as hotel developments in Asia, nonessential lights such as façade flood lights and lightings at lobbies, car parks, staircases, walkways, and corridors were switched off. Tenants were also encouraged to participate in Earth Hour. Mrs Gerner, a resident at Royal Park Sedona Suites Hanoi, added, This gives me an opportunity to do something positive for my planet and the environment and to take a step towards a cleaner environment for my kids. This is not just about saving energy for an hour; it is about going further beyond the hour, it is about taking lasting actions to care for our planet. After six years since its conceptualisation in Sydney, Australia, the largest global climate change movement, Earth Hour, will be moving its global headquarters to Singapore. This move represents the next frontier of the campaign with Singapore acting as a gateway that bridges Southeast Asia, a growing community base, to the rest of the world. keppelite Mr Hoh Wing Tuck, Director of Property Services at Morgan Stanley, a tenant at Capital Square, shared, Morgan Stanley is glad that the landlord has participated in Earth Hour in the past few years as we also share the same concerns about the environment. It is heartening to see many tenants working with the landlord in a deliberate effort to save energy. Activities for Earth Hour were organised at accommodation lodges such as Acacia Lodge to engage our foreign workers Before Keppel Bay all aglow After Lights out at Keppel Bay during Earth Hour

48 48 Nurturing Communities Stepping out for charity Over 300 Keppelites turned up at West Coast Park for a Group-wide charity walkathon on 25 March 2012, which was organised in support of Keppel-Gawad Kalinga (GK) Eco Village in Bauan, the Philippines. Proceeds raised will go towards the Eco Village s final phase of development, which includes the construction of 20 homes, a community centre, a pre-school as well as a rain harvesting and reed bed system. Flagged off by Guest-of- Honour Mr Choo Chiau Beng, CEO of Keppel Corporation, the walkathon saw Keppelites enjoying the three-kilometre fun-filled walk in the company of friends, colleagues, families and pets. In addition to the walkathon, donation cards had been distributed to all Keppel business units and altogether, a total of $90,000 is targeted to be raised. keppelite Keppelites trot for a worthy cause in support of the Keppel-Gawad Kalinga (GK) Eco Village in Bauan, the Philippines

49 Nurturing Communities 49 Amazing race Mr Choo Chiau Beng, CEO of Keppel Corporation and Chairman of Keppel Land, received a token of appreciation by Prime Minister Lee Hsien Loong for Keppel s contribution to the Kwa Geok Choo Professorship in Property Law Tribute to a pioneer As a tribute to the late Madam Kwa Geok Choo, wife of former Minister Mentor Lee Kuan Yew, and to recognise her work as a leading real estate lawyer in Singapore, the National University of Singapore has set up the Kwa Geok Choo Professorship in Property Law. In support, Keppel has contributed $500,000 as principal benefactor of the programme. At the appreciation dinner held on 12 April 2012 at St Regis hotel, Keppel Corporation was presented a token of appreciation by Prime Minister Lee Hsien Loong. Mr Choo Chiau Beng, CEO of Keppel Corporation and Chairman of Keppel Land, said, Madam Kwa, as the founding mother of Singapore, has been a pioneer in establishing today s property laws. In land-scarce Singapore, Keppel s property business benefited from these clear property laws. This programme is a fitting recognition in memory of Madam Kwa. This programme has attracted Professor Kevin Gray, a renowned professor from Trinity College, Cambridge University to be the first Chair. We hope that he will bring the teaching and research in property law in Singapore to the highest level in the world, allowing buyers and sellers of property to benefit. keppelite Over 800 participants, including 80 Keppelites from Keppel Offshore & Marine (Keppel O&M) took part in a roundt h e - i s l a n d A m a z i n g Maritime Challenge on 22 April The race, of which Keppel C o r p o r a t i o n w a s a sponsor, was part of a slew of activities organised in conjunction with the Singapore Maritime Week from 22 to 27 April Teams pitted their skills and knowledge in a series of maritime-themed games and quizzes. Held in and around the Maritime Experiential Museum & Aquarium, teams strategised and competed for the top cash prize of $1,500. Out of the 20 Keppel O&M teams which participated, Team Buoy led by Yvonne Ng, Commercial Executive at Keppel FELS, completed all nine stations in less than three hours and clinched the first runner-up spot in the open category. Yvonne shared, It was a great experience for us! We had so much fun exploring Singapore while learning about the vibrant maritime industry which is commonly known to be a complex subject. Winning the race made it extra meaningful for us. The Amazing Maritime Challenge was jointly organised by the Maritime and Port Authority of Singapore, the Association o f S i n g a p o r e M a r i n e Industries, the Singapore Maritime Foundation and the Singapore Shipping Association. keppelite Mr Michael Chia (extreme right), MD (Offshore) of Keppel O&M, kickstarted the Amazing Maritime Challenge which drew over 800 participants

50 50 Nurturing Communities SSO supporter The annual Singapore Symphony Orchestra (SSO) Benefit 2012 was held at the Ritz-Carlton Millenia Singapore on 31 March At the ceremony, Guestof-Honour, His Excellency Dr Tony Tan Keng Yam, President of the Republic of Singapore, presented the SSO Benefactor Award to Keppel Corporation, received by Ms Wang Look Fung, Director of Group Corporate Affairs. The award is presented to individuals and organisations who have donated a cumulative sum of S$1 million to the SSO. The dinner, attended by over 400 distinguished guests from the business and social circles, raised a total of S$1,055,000 for the SSO. keppelite Ms Wang Look Fung, Director of Group Corporate Affairs, receiving the SSO Benefactor Award awarded to Keppel from the President, Dr Tony Tan Keng Yam Friends for all seasons As a dedicated arts supporter, Keppel Corporation was a proud co-sponsor of renowned violinist Sarah Chang s recent performances of Vivaldi s Four Seasons in partnership with the Singapore Symphony O r c h e s t r a o n 6 a n d 7 A p r i l a t t h e Esplanade Concert Hall. Mr Choo Chiau Beng, CEO of Keppel Corporation, hosted friends of Keppel at the preconcert cocktail reception which was graced by Minister S Iswaran, Minister in the Prime Minister s Office and Second Minister for Home Affairs and Trade & Industry. Ms Chang s performance was greeted with rapturous applause and capped a wonderful night of music and camaraderie. keppelite Minister Iswaran (centre) was the Guest-of-Honour at the pre-concert cocktail reception. With him are Keppel Corporation s Chairman Dr Lee Boon Yang (left) and CEO Mr Choo Chiau Beng (right)

51 Nurturing Communities 51 Uniting to save Earth In a joint effort to promote awareness about climate change, Keppel Volunteers and students from Delta Senior School, a learning i n s t i t u t e u n d e r t h e Association for Persons with Special Needs (APSN), united as Earth Hour ambassadors in the first-ever Earth Hour human formation in Singapore on 31 March 2012 in Orchard Road. Over a hundred Keppelites, t o g e t h e r w i t h A P S N students, stood shoulder to shoulder to form the digit 6 in the human formation spelling out 60+ SINGAPORE, before the lights along Orchard were switched off for an hour to mark Earth Hour. The human formation is the culmination of a series of Earth Hour activities organised by the World Wide Fund for Nature (WWF). The event, held at Orchard Road, included a concert by local artistes and a carnival o f b o o t h s p ro m o t i n g energy-efficient products and sustainable living. Keppelites shared ecofriendly tips with the students and reiterated to them the need to reduce, reuse and recycle. Lo Yu Foh, Procurement and Facility Engineer at Blastech Abrasives, a division of Keppel Offshore & Marine, led Keppel Volunteers in the outreach effort. Yu Foh explained, Keppel Volunteers aims to play a n a c t i v e ro l e i n t h e d e v e l o p m e n t o f t h e beneficiaries that we support. We invited APSN to join us in our Earth Hour effort as we felt that it would be a fun way to expose the students to environmental issues. Through their interaction with volunteers in such events, the students also develop social skills, and this helps in their assimilation into society. Michelle Tan, a teacher from Delta Senior School who worked with Keppel on the outreach activity, agreed, The students participation in Earth Hour helps reinforce what they learnt in school, about taking responsibility to save the earth from climate change. The event is a great way of engaging them in sustainability efforts, and it also made them feel proud of their role as ambassadors of the global green movement. Earth Hour is an annual worldwide event organised by WWF. Households and businesses are encouraged to turn off non-essential lights for one hour to raise awareness about the need to take action on climate change. The APSN is the adopted charity of Keppel Volunteers. keppelite Keppelites and APSN students unite to champion a greener future at the Earth Hour celebrations in Orchard Road

52 52 BackPage Five more DSS 38E units for Sete Brasil at US$4.12 b Keppel Offshore & Marine (Keppel O&M), through its subsidiaries, Keppel FELS Brasil S.A. and Estaleiro BrasFELS Ltda, has signed a Letter of Intent (LOI) with Sete Brasil Participações S.A. (Sete Brasil), to design and construct five semisubmersible drilling rigs based on Keppel s proprietary DSS 38E design. The LOI facilitates Keppel O&M s preparation work on these potential projects, pending the signing of the final construction c o n t r a c t s. T h e t o t a l value of the contracts, if and when successfully agreed and executed, will be approximately US$4.12 billion. Keppel O&M had secured a contract to build one DSS 38E semisubmersible for Sete Brasil earlier in December The additional five rigs will support Brazil s exploration of its vast proven offshore oil and gas resources. Mr Tong Chong Heong, CEO, Keppel O&M, said, We are pleased that S e t e B r a s i l i s m o v i n g ahead with the decision to order the five additional semisubmersibles on top of the first DSS 38E unit ordered late last year. With our proven track record of our Angra yard in Brazil, we are in a good position to continue to contribute effectively to the growth of Brazil s oil and gas industry. Sete Brasil s CEO, Mr Joao Carlos Ferraz, said, We have entered into this LOI for five additional semisubmersibles from Keppel, as we are confident of Keppel s strong track record in the design and construction of deepwater rigs, as well as their established yard in Brazil. It is full steam ahead for us in growing our fleet of rigs and vessels to support the exploration and production activities in offshore Brazil, and we need to partner shipyards like Keppel which can deliver the quality rigs in a timely manner. The DSS 38E design is an enhancement of K e p p e l s p ro v e n f i f t h generation deepwater solution, the DSS 38. With improved capability and operability, the DSS 38E is well suited to meet the stringent requirements of the deepwater Golden Triangle region, comprising Mr Tong Chong Heong (right), CEO of Keppel O&M, and Mr Pedro Barusco, COO of Sete Brasil, after the signing of the Letter of Intent for the design and construction of five additional semis based on Keppel s proprietary DSS 38E design Brazil, Africa and the Gulf of Mexico. Jointly developed and owned by Keppel s Deepwater Technology Group and Marine Structure Consultants, the DSS 38E design is an innovative and cost-effective design. It is rated to drill to depths of 10,000 metres below the rotary table in 3,000 metres water depth. Its operational displacement is approximately 45,000 tonnes. Each rig will have accommodation facilities to house a crew of up to 160 men. The vessel is designed to stay in position v i a e i g h t A z i m u t h i n g t h r u s t e r s a n d t h e configurations comply with the American Bureau of Shipping Dynamic Positioned System (DPS-3) requirements. keppelite Printed on recycled paper